Question

At January ​1, ​2018, Windy Mountain Flagpoles had Accounts Receivable of $32,000​, and Allowance for Bad Debts had a credit balance of $4,000. During the​ year, Flagpoles recorded the​ following:

Requirement 2. Post Windy's transactions to the Accounts Receivable and Alcwanse for Bed Debts T-accounts. Enter the beginning balances and the journal entries, and then compute the unadjusted balance of each account. Accounts Receivable Allowance for Bad Debts Requirement 3. Joumaize Windy's adjustment to record tac debts expense assuming Vindy estimates bad debts as 10% of socounts receivable. Post the acjustment to the appropriate accounts. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Firsl journalice Windy's edustriell record badebis experise DADA Accounts and Explanation Dabi 2019 Dec. 31 Credit Post the adjustment to the appropriate accounts. Enter the unsdjusted balances corpuled in requirment 2 and the the begirming balance for the Bad Debt. Experke account. The post the aduenient and compute the December 31 aduste bakrice of each part. Enter a "O' on the rormal side of the account for any zero balances Accounts Receivable Allowance for Bad Debia Bad Debts Expense Requirement 4. Show how Windy Mountain Flagpoles wil report net ascounts receivable on its December 21, 2019, balance sheet Balance Sheet (Partial): Curace

Answer 1

Requirement 2. Journale Entries -

Journal Entries Date Accounts Title Debit Credit a Cash $ 16,000 Accounts Receivables $ 156,000 Sales Revenue $ 172,000 (Being sale revenue earned by cash and on account) b Cash $125,000 Accounts Receivables (Being amount received on account) $125,000 C Allowance for bad debts $ 2,200 Accounts Receivables $ 2,200 (Being written off uncollectible receivables)

Requirement 2. Ledgers -

Date Date Accounts Receivables Debit Date $ 32,000 b $ 156,000 с Allowance for bad debts Debit Date Credit $ 2,200 Jan 1 $ 4,000 Credit $125,000 $ 2,200 Jan 1 с a Dec 31 $ 1,800 Dec 31 $ 60,800 $ 4,000 $ 4,000 $ 188,000 $ 188,000

Requirement 3. Adjusting Entries -

Date Credit 1 Adjusting Entries Accounts Title Debit Bad Debts $ 4,280 Allowance for bad debts (Being provision for doubtful debt made) ($60800 x 10%) - Balance $1,800 $ 4,280

Requirement 3. Adjusting Ledgers -

Date Accounts Receivables Debit Date $ 32,000 b $ 156,000 с Jan 1 Credit $125,000 $ 2,200 Allowance for bad debts Date Debit Date Credit с $ 2,200 Jan 1 $ 4,000 1 $ 4,280 Dec 31 $ 6,080 a Dec 31 $ 60,800 $ 8,280 $ 8,280 $ 188,000 $ 188,000 Date 1 Bad Debts Debit Date Credit $ 4,280 Income Summary $ 4,280 $ 4,280 $ 4,280

Requirement 4. Balance Sheet (Partial) -

Balance Sheet (Partial) As on Dec 31, 2018 Current Assets: Accounts Receivables $ 60,800 (-) Allowance for bad debts $ (6,080) Net Accounts Receivable $ 54,720