Assignment
Record accounts receivable and bad debt transactions; show financial statement presentation. (LO 1, 2, 4) AP
At the beginning of the current period, Fassi Co. had a balance of $800,000 in Accounts Receivable and a $44,000 credit balance in Allowance for Doubtful Accounts. In the period, it had net credit sales of $1,900,000 and collections of $2,042,000. It wrote off accounts receivable of $58,000. After a $4,000 account was written off as uncollectible, it was subsequently collected. This is in addition to the other cash collections. Based on an aging schedule, uncollectible accounts are estimated to be $36,000 at the end of the period.
Instructions
(a) Record sales and collections in the period.
(b) Record the write off of uncollectible accounts in the period.
(c) Record the collection of the account previously written off.
(d) Record the bad debt expense adjusting entry for the period.
(e) Show the balance sheet presentation of the accounts receivable at the end of the period.
(f) What is the bad debt expense on the income statement for the period?