At December 31, 2021, Pina Co. reported the following information on its balance sheet. Accounts receivable $960,100 Less: Allowance for doubtful accounts 78,200 During 2022, the company had the following transactions related to receivables. 1. Sales on account $3,739,000 2. Sales returns and allowances 49,400 3. Collections of accounts receivable 2,814,000 4. Write-offs of accounts receivable deemed uncollectible 90,500 5. Recovery of accounts previously written off as uncollectible 28,000 1. 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.) (Credit account titles are automatically indented when amount is entered. Do not indent manually.) 2 .Enter the January 1, 2022, balances in Accounts Receivable and Allowance for Doubtful Accounts, post the entries to the two accounts (use T-accounts), and determine the balances. (Post entries in the order of journal entries presented in the previous part.) 3 . Prepare the journal entry to record bad debt expense for 2022, assuming that an aging of accounts receivable indicates that expected uncollectibles are $115,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) 4 . Compute the accounts receivable turnover and average collection period for 2022. (Round accounts receivable turnover to 2 decimal places, e.g. 25.25 and average collection period to 1 decimal place, e.g. 25.2.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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At December 31, 2021, Pina Co. reported the following information on its balance sheet.

Accounts receivable		$960,100
Less: Allowance for doubtful accounts		78,200

During 2022, the company had the following transactions related to receivables.

1.	Sales on account	$3,739,000
2.	Sales returns and allowances	49,400
3.	Collections of accounts receivable	2,814,000
4.	Write-offs of accounts receivable deemed uncollectible	90,500
5.	Recovery of accounts previously written off as uncollectible	28,000

1. 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.) (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

2 .Enter the January 1, 2022, balances in Accounts Receivable and Allowance for Doubtful Accounts, post the entries to the two accounts (use T-accounts), and determine the balances. (Post entries in the order of journal entries presented in the previous part.)

3 . Prepare the journal entry to record bad debt expense for 2022, assuming that an aging of accounts receivable indicates that expected uncollectibles are $115,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

4 . Compute the accounts receivable turnover and average collection period for 2022. (Round accounts receivable turnover to 2 decimal places, e.g. 25.25 and average collection period to 1 decimal place, e.g. 25.2.)

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