FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Leach Incorporated experienced the following events for the first two years of its operations.
Year 1:
Issued $24,000 of common stock for cash.
Provided $93,400 of services on account.
Provided $50,000 of services and received cash.
Collected $83,000 cash from
Paid $52,000 of salaries expense for the year.
Adjusted the accounting records to reflect uncollectible accounts expense for the year.
Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.
Closed the revenue account.
Closed the expense accounts.
Year 2:
Wrote off an uncollectible account for $1,350.
Provided $102,000 of services on account.
Provided $46,000 of services and collected cash.
Collected $95,000 cash from accounts receivable.
Paid $79,000 of salaries expense for the year.
Adjusted the accounts to reflect uncollectible accounts expense for the year.
Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.
Closed the revenue account.
Closed the expense accounts.
d. Record the Year 2 events in general journal form and post them to T-accounts. Prepare the income statement, statement of changes in
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