?8-7B. Journal Entries for Credit Losses At January 1, the Sherry Company had the following...
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?8-7B. Journal Entries for Credit Losses At January 1, the Sherry Company had the following accounts on its books: LO1, 2 Accounts receivable Allowance for doubtful accounts. HH $255,000 (debit) 13,600 (credit) During the year, credit sales were $1,750,000 and collections on account were $1,588,000. The follow- ing transactions, among others, occurred during the year: Jan. 11 Wrote off J. Smith's account, $5,800. Apr. 29 Wrote off B. Bird's account, $2,500. Nov. 15 Received $1,500 from B. Bird to pay a debt that had been written off April 29. This amount is not included in the $1,588,000 collections. Dec. 5 Wrote off D. Finger's account, $4,300. 31 In an adjusting entry, recorded the allowance for doubtful accounts at three percent of credit sales for the year. Required a. Prepare journal entries to record the credit sales, the collections on account, the transactions, and the adjustment. b. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on the Decem- ber 31 balance sheet
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