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Urgent An inexperienced accountant made the following entries. In each case, the explanation to the entry is correct. Assume that at 12/31, the correct balance
Urgent An inexperienced accountant made the following entries. In each case, the explanation to the entry is correct. Assume that at 12/31, the correct balance of the Allowance account before adjustment is $0 - Dec. 17 Cash Sales Discounts 138 Accounts Receivable 7,038 (To record collection of 12/4 sales of $6,900, terms 2/10,n/30 ) 27 Cash 1,200 Bad Debt Expense 1,200 (Collection of account previously written off as uncollectible under allowance method) 31 Bad Debt Expense 3,600 Allowance for Doubtful Accounts 3,600 (To recognize estimated uncollectibles based on 5% of accounts receivable of $720,000) Prepare the correcting entries. Errors were identified at the end of the year. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) (To correct accounts for granting sales discount when discount period had lapsed) Dec 27 Accounts Receivable Allowance for Doubtful Accounts (To reverse write off of collected account) Dec. 27 Bad Debt Expense Accounts Receivable (To record collection) Bad Debt Expense Allowance for Doubtful Accounts
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