Question

Get Away Travel ended 2019 with Accounts Receivable at $88,000 and an Allowance for Doubtful Accounts at $8,200. During 2020, Get Away Travel completed those transactions 1. Service revenue on account, S960,000 (assume no cost of goods sold). 2. Collections on account, $840,000 3. Write-offs of uncollectibles, $7,600 4. Bad debt expense, 1 percent of service revenue Journalize Get Away Travel's 2020 transactions, and show updated balance sheet totals Bogin by recording service revenue Service revenue on account, $900,000 (assume no cost of goods sold). (Record debits first, then credits. Exclude explanations from Journal entries.) Journal Entry Accounts Debit Credit

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Answer 1

Preparation of Journal Entries for the given transactions: Journal Entries Date Account Title and Explaination Post. Ref. Debit $ Credit $ 1 $ 960,000.00 Accounts Receivable Service Revenue (To record Service Provided on account) $ 960,000.00 2 $ 840,000.00 Cash Accounts Receivable (To collection of receivables) $ 840,000.00 3 $ 7,600.00 Allowance for Doubtful Accounts Accounts Receivable (To record writing off of uncollectible accounts) $ 7,600.00 4 $ 9,600.00 Bad Debts Expense ($960000 x 1%) Allowance for Doubtful Accounts $ 9,600.00 (To record adjusting entry for estimated bad debts)