Question

During its first year of​ operations, Summer Sand and Castles Resort Inc. had sales of $ 825000​, all on account. Industry experience suggests that Summer Sand and Castles Resort's bad debt expense will be $ 10 500. Summer Sand and Castles Resort ended the year 2016 with accounts receivable of $ 90 000 and an allowance for uncollectible accounts of ​$17500. During 2017​, Summer Sand and Castles Resort completed the following​ transactions:

1. Credit​ sales, $ 1 050 000

2. Collections on​ account, $ 870 000

3. ​Write-offs of​ uncollectibles, $ 20 000

4. Bad debt​ expense, $ 10 500

During its first year of operations, Summer, Sand, and Castles Resort Inc. had sales of $825,000, all on account. Industry experience suggests that Summer, Sand, and Castles Resort's bad debt expense will be $10,500. Summer, Sand, and Castles Resort ended the year 2016 with accounts receivable of $90,000 and an allowance for uncollectible accounts of $17,500. During 2017, Summer, Sand, and Castles Resort completed the following transactions: 1. Credit sales, $1,050,000 2. Collections on account, $870,000 3. Write-offs of uncollectibles, $20,000 4. Bad debt expense, $10,500 Journalize the 2017 transactions for Summer, Sand, and Castles Resort. Explanations are not required. We will begin by recording sales revenue. (Record debits first, then credits. Explanations are not required.) Journal Entry Accounts Debit Credit Now we will record collections. Journal Entry Accounts Debit Credit Next, we will record receivables actually written off during the year. Journal Entry Accounts Debit Credit Accounts Payable Accounts Receivable Allowance for Uncollectible Accounts Choos Bad Debt Expense Cash Sales Revenue nput fields and then continue to the next question.

Answer 1

Solution:

Journal Entries - Summer Sand and Castles Resort Inc
Transaction	Particulars	Debit	Credit
1	Accounts receivables Dr	$1,050,000.00
	To Sales revenue		$1,050,000.00
2	Cash Dr	$870,000.00
	To Accounts receivables		$870,000.00
3	Allowance for uncollectible accounts Dr	$20,000.00
	To Accounts receivables		$20,000.00
4	Bad debts expense Dr	$10,500.00
	To Allowance for uncollectible accounts		$10,500.00