Question

Homework: Exercise 8-18 Score: 0 of 10 pts E8-18 (similar to) At January 1, 2018, Purple Mountain Flagpoles had Accounts Receivable of $27,000, and Allowance for Bad Debts had a credit balance of $3,000. During the year, 1 of 1 (0 complete) HW Score: 0%, 0 of 10 pts EQuestion Help Purple Mountain Flagpoles recorded the following (Click the icon to view the transactions.) Read the requirements Requirement 1. Joumalize Purple's transactions that occurred during 2018. The company uses the allowance method. (Record debits first, then credits. Select the (a.) Sales of $182.000 ($165,000 on account $17,000 for cash) Ignore Cost of Goods Sold. (Prepare a single compound journal entry.) Accounts and Explanation Debit Credit Date 2018 Choose from any list or enter any number in the input fields and then click Check Answer parts remaining Clear All Check Answer More Info a. Sales of $182,000 ($165,000 on account, $17,000 for cash). lgnore Cost of Goods Sold. b. Collections on account, $126,000 c. Write-offs of uncollectible receivables, $2,200. Print Done Requirements 1. 2. 3. Journalize Purple's transactions that occurred during 2018. The company uses the allowance method. Post Purple's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts. Journalize Purple's adjustment to record bad debts expense assuming Purple estimates bad debts as 2% of credit sales. Post the adjustment to the appropriate T-accounts 4. Show how Purple Mountain Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet. Print Done

Answer 1

Journal entries:
S.no.	Accounts title and explanation				Debit $	Credit $
a.	Accounts receivable				165000
	Cash account				17000
	Sales revenue					182000
b.	Cash account				126000
	Accounts receivable					126000
c.	Allowance for bad debts				2200
	Accounts receivable					2200
Accounts Receivable
Balance			27000	Cash			126000
Sales revenue			165000	Allowance for bad debts			2200
Balance			63800
Allowance for Bad debts
Accounts receivable			2200	balance			3000
				Balance			800
Req 3.	Bad debts expenses (165000*2%)				3300
	Allowance for bad debts					3300
Allowance for Bad debts
Accounts receivable			2200	balance			3000
				Bad debts expenses			3300
				Balance			4100
Req 4.
Net Accounts receivable:
Accounts receivable-Gross			63800
Less: Allowance			-4100
Net Accounts receivable:			59700