Question

P8-6A. Allowance Meth Record the foregoing transactions and adjustments in general journal form. avance Method The Irvine Company, which has been in business for three years, makes all of its sales on account and does not offer cash discounts. The firm's credit sales, collections from custom- ers, and write-offs of uncollectible accounts for the three-year period are summarized below: Year Sales Accounts Written Off 2018 2019 2020 $600,000 770,000 860,000 Collections $574,000 740,000 814,000 $4,200 6,900 7,300

Answer 1

Computation Account Recievable each you year op. bou ey collectable Baddest ce.bal 2018 26ooo 20021860 2019 21800 36000 yu 900 2020 wegoo I u6ooo 7300 183600 o Account Recievable to be shown in the Balance sheet 9 2020 = 836004 Allowance to be shown in the lisme Balance sheet on 2020 cest- GOOOD. x 193% 22000 (3 86000 (3% 20o 0010 ille to the e Total Bad debts to be expensed profil & Loss each you for 2018 Bad debes contten of a 4200 (+) Со цоорсе о cx = agos 1 2009 tion fos 2019 Bad debts content to ce pronston opening provision G900 10010 a pool allo 7300 for- 2020 for bad dust conten on = Kto ch prov soon : - opening prowesson - (10olo) furo