contestada

At December 31, 2021, Suisse Imports reported this information on its balance sheet.

Accounts receivable $600,000
Less: Allowance for doubtful accounts 37,000

During 2022, the company had the following transactions related to receivables.

1. Sales on account $2,500,000
2. Sales returns and allowances 50,000
3. Collections of accounts receivable 2,200,000
4. Write-offs of accounts receivable deemed uncollectible 41,000
5. Recovery of bad debts previously written off as uncollectible 15,000

Required:
a. Prepare the journal entries to record each of these five transactions.
b. Prepare the journal entry to record bad debt expense for 2021, assuming that aging the accounts receivable indicates that estimated bad debts are $46,000.
c. Compute the accounts receivable turnover.

Respuesta :

anthougo

Answer:

Suisse Imports

a. Journal Entries to record transactions:

1. Debit Accounts receivable $2,500,000

Credit Sales revenue $,2500,000

To record the sale of goods on account.

2. Debit Sales returns and allowances $50,000

Credit Accounts receivable $50,000

To record the return of goods on account.

3. Debit Cash $2,200,000

Credit Accounts receivable $2,200,000

To record the receipt of cash from customers.

4. Debit Allowance for doubtful accounts $41,000

Credit Accounts receivable $41,000

To record the write-off of accounts considered doubtful.

5. Debit Accounts receivable $15,000

Credit Allowance for doubtful accounts $15,000

To reverse the write-off of accounts considered doubtful.

5. Debit Cash $15,000

Credit Accounts receivable $15,000

To record the cash received from customers.

b. Journal Entry to record bad debt expense for 2022:

Debit Bad debts expense $46,000

Credit Allowance for doubtful accounts $46,000

To record the bad debt expense for the year.

c. Accounts receivable turnover

= 3.48 times

Explanation:

a) Data and Calculations:

Accounts receivable $600,000

Less: Allowance for doubtful accounts 37,000

Analysis of Transactions during 2022:

1. Accounts receivable $2,500,000 Sales revenue $,2500,000

2. Sales returns and allowances $50,000 Accounts receivable $50,000

3. Cash $2,200,000 Accounts receivable $2,200,000

4. Allowance for doubtful accounts $41,000 Accounts receivable $41,000

5. Accounts receivable $15,000 Allowance for doubtful accounts $15,000

5. Cash $15,000 Accounts receivable $15,000

b. Bad debts $46,000 Allowance for doubtful accounts $46,000

Accounts Receivable

Accounts Title              Debit        Credit

Beginning balance   $600,000

Sales revenue         2,500,000

Sales returns and allowances      $50,000

Cash                                           2,200,000

Allowance for doubtful accounts    41,000

Allowance for

doubtful accounts      15,000

Cash                                                 15,000

Ending balance                            809,000

Average accounts receivable:

Beginning balance $600,000

Ending balance        809,000

Total                     $1,409,000

Average = $704,500 ($1,409,000/2)

Net Sales:

Sales revenue                     $,2500,000

Sales returns and allowances $50,000

Net sales                             $2,450,000

Accounts receivable turnover = Net sales/Average receivable

= $2,450,000/$704,500

= 3.48 times

Otras preguntas