Question

May 1. Sold merchandise on account to Beijing Palace Co., $36,010. The cost of the merchandise sold was $22,050. Aug. 30. Received $11,500 from Beijing Palace Co. and wrote off the remainder owed on the sale of May 1 as uncollectible. Dec. 8. Reinstated the account of Beijing Palace Co. that had been written off on August 30 and received $24,510 cash in full payment. Required: Journalize the above transactions in the accounts of Sedona Interiors Company, a restaurant supply company that uses the allowance method of accounting for uncollectible receivables. Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

Credit Debit Docte General Jour nal May 1- dale Accoundd Receivable-beijing Palace Co$ 36,010 36,010 dales (To secord sales) May 1 Cest of merchanclis e edolol merchandise Inventory d2,oso d2,0 50 Cost To secosd cost o good setd) 11,500 Cash Aug- 30 Alowance for Doubtful Accounts 4, S10 Accounts Receivable - Beijing Pala ce Co 36,010 To Recondcash seceiued aud &emainder owed whitten ot) Accounts Receivable - Beijing Palace Co ,S10 Sec 8- reinatated Alouwance for Doubthul Accouts 4,510 To hecoAd aceouut Aeinstated) Cash fay,Slo Dec8- ceuection Accounts Reeeivable - Beiging Palace Co 24,510 (To Aecond cah Neceiuedl) Calcul atiou : Aug 30: Alousance for Doubt ful Aceounts = Aal es- Case Aeceiveds $ 36,010 $ 11,500 24,510 1