80.2K

Verified Solution

Link Copied!

Casebolt Company wrote off the following accounts receivable as uncollectible for the first year of its operations ending December 31, 2016:

Customer	Amount
Shawn Brooke	$4,630
Eve Denton	5,185
Art Malloy	11,089
Cassie Yost	9,167
Total	$30,071

Required:

A.

On December 31, journalize the write-offs for 2016 under the direct write-off method. Refer to the Chart of Accounts for exact wording of account titles.

B.

On December 31, journalize the write-offs for 2016 under the allowance method. Also, journalize the adjusting entry for uncollectible accounts. The company recorded $5,248,000 of credit sales during 2016. Based on past history and industry averages, 0.70% of credit sales are expected to be uncollectible. If no entry is required, simply skip to the next transaction. Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTS
Casebolt Company
General Ledger
ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable-Shawn Brooke 122 Accounts Receivable-Eve Denton 123 Accounts Receivable-Art Malloy 124 Accounts Receivable-Cassie Yost 129 Allowance for Doubtful Accounts 131 Interest Receivable 132 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Store Equipment 192 Accumulated Depreciation-Store Equipment 193 Office Equipment 194 Accumulated Depreciation-Office Equipment LIABILITIES 210 Accounts Payable 211 Salaries Payable 213 Sales Tax Payable 214 Interest Payable 215 Notes Payable EQUITY 310 Owner, Capital 311 Owner, Drawing 312 Income Summary	REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Merchandise Sold 520 Sales Salaries Expense 521 Advertising Expense 522 Depreciation Expense-Store Equipment 523 Delivery Expense 524 Repairs Expense 529 Selling Expenses 530 Office Salaries Expense 531 Rent Expense 532 Depreciation Expense-Office Equipment 533 Insurance Expense 534 Office Supplies Expense 535 Store Supplies Expense 536 Credit Card Expense 537 Cash Short and Over 538 Bad Debt Expense 539 Miscellaneous Expense 710 Interest Expense

A. On December 31, journalize the write-offs for 2016 under the direct write-off method. Refer to the Chart of Accounts for exact wording of account titles Question not attempted PAGE 1 JOURNAL Score: 0/61 DATE DESCRIPTIO POST. REF DEBIT CREDIT

Answer & Explanation Solved by verified expert

See Answer