Supplement Recording Sales, Returns, and Bad Debts
Use the data presented in P6-2, which were selected from the records of Sykes Company for the year ended December 31, 2011.
Required:
1. Give the journal entries for these transactions, including the write-off of the uncollectible account and the adjusting entry for estimated bad debts. Do not record cost of goods sold. Show computations for each entry.
2. Show how the accounts related to the preceding sale and collection activities should be reported on the 2011 income statement. (Treat sales discounts as a contra-revenue.)