Outdoor Equipment (OE) sells camping equipment. On December 1, the accounts receivable account had a balance of $51,600, the bad debt expense account had a balance of $0, and the allowance for doubtful accounts had a credit balance of $5,160. Journalize the remaining journal entries for the 2020 year. Dec. 2 Sold tents for $5,320 on account with a cost of $2,660. 20 Determined that the total accounts of Rocky Co. with an accounts receivable balance of $1,360 and Grouse Co. with an accounts receivable balance of $2,660 were uncollectible and needed to be written off. 23 Unexpectedly received payment from Grouse Co. for $2,660. 31 Estimated that 10% of accounts receivable recorded to date would be uncollectible. Required: 1. Prepare journal entries to record the transactions. Note: Write-off of uncollectible accounts for Rocky Co. and Grouse Co. should be posted separately. 2. Post the T-account for accounts receivable, bad debt expense, and allowance for doubtful accounts. Determine the ending balance for each account.
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Outdoor Equipment (OE) sells camping equipment. On December 1, the accounts receivable account had a balance of $51,600, the
2. Post the T-account for accounts receivable, bad debt expense, and allowance for doubtful accounts. Determine the ending balance for each account.
Step by step
Solved in 2 steps with 2 images
