On January 1 of the current year, Slaton, inc. had the following accounts on its...
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Accounting
On January 1 of the current year, Slaton, inc. had the following accounts on its books:
Accounts Receivable $120,000 (debit)
Allowance for Uncollectible Accounts 4,000 (credit)
During this year, credit sales were $600,000 and collections on account were $580,000.
Required:
A.) Prepare general journal entries for the following transactions that occurred during the year:
(1) Wrote off L. Baxters account, $3,400.
(2) Wrote off N. Vales account, $1,200.
(3) N. Vale, who is in bankruptcy, paid $400 in final settlement of the account written off in transaction (2). This amount is not included in the $580,000 collections.
(4) On December 31, estimated the years bad debts expense at 1% of credit sales.
B.) Show how Accounts Receivable and the Allowance for Uncollectible Accounts would appear on the year-end balance sheet.
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