BUS 591 Week 4 Template 2013

BUS591 – Financial Statement and Analysis

Week 4 Homework Assignment Templates

Instructions: Only enter data in the yellow boxes. The remaining areas are already completed for you.

Save the file as follows: lastnamewk4.docx

Submit to the assignment box before the due date. (Late assignments will receive a late penalty).

Problem 8-2B

(a) Journalize the transactions, including explanations. (Note, enter all accounts in one box. The dates have been included to help with formatting).

Date

Account Titles and Explanation

Debit

Credit 1

Accounts Receivable Sales Revenue

$3,600,000

$3,600,000

(To record sales on account)

2

Sales Returns and Allowances Accounts Receivable

$150,000

$150,000

(To record merchandise returned)

3

Cash Accounts Receivable

$3,100,000

$3,100,000

(To record collection of accounts receivable)

4

Bad Debt Expense Allowance for Doubtful Accounts

$92,000

$92,000

(To record uncollectible accounts)

5

Accounts Receivable Allowance to Doubtful Accounts
Cash
Accounts Receivable

$28,000

$28,000

$28,000

$28,000

(To reverse write-off of debts previously considered uncollectable)

(b) Enter the January 1, 2014 balances in Accounts Receivable and Allowance for Doubtful Accounts. Post the transactions to the ledger T Accounts
Be sure to post the amounts to the correct side of the T-Account!

Accounts Receivable
Bal. $960,000
(2) $150,000
(1) $3,600,000
(3) $3,100,000
(5) $28,000
(4) $92,000

(5) $28,000
Bal. $1,218,000

Allowance for Doubtful Accounts
(4) $92,000
Bal. $78,000

(5) $28,000

Bal. $14,000

(c) Prepare the journal