FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Question
At December 31, 2019, SoundMaster Company reported this information
on its
Less: Allowance for doubtful accounts 78,000
During 2019, the company had the following transactions related to receivables.
1. Sales on account $3,600,000
2. Sales returns and allowances 150,000
3. Collections of accounts receivable 3,100,000
4. Write-offs of accounts receivable deemed uncollectible 92,000
5. Recovery of
Instructions
a) Prepare the journal entries to record each of these five transactions. Assume
that no cash discounts were taken on the collections of accounts receivable.
(Omit cost of goods sold entries.)
b) Enter the January 1, 2019, balances in Accounts Receivable and
Allowance for Doubtful Accounts,
(use T-accounts), and determine the balances.
c) Prepare the
that aging the accounts receivable indicates that expected bad debts are
$140,000.
d) Compute the accounts receivable turnover and average collection period.
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