College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Chapter 16, Problem 6SEA
DIRECT WRITE-OFF METHOD Maria Rivera, owner of Rivera Pharmacy, uses the direct write-off method in accounting for uncollectible accounts. Record the following transactions in general journal form:
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Journalize entries for the following related transactions of Greenville Heating & Air Company. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
Mar.
1
Purchased $54,200 of merchandise from Foster Co. on account, terms 2/10, n/30.
9
Paid the amount owed on the invoice within the discount period.
11
Discovered that $7,000 of the merchandise purchased on Mar. 1 was defective and returned items, receiving credit.
18
Purchased $6,000 of merchandise from Foster Co. on account, terms n/30.
20
Received a refund from Foster Co. for return on Mar. 11 less the purchase on Mar. 18.
Presented below are two independent situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
(a)
On January 6, Novak Co. sells merchandise on account to Pryor Inc. for $13,500, terms 2/10, n/30. On January 16, Pryor Inc. pays the amount due. Prepare the entries on Novak’s books to record the sale and related collection.
(b)
On January 10, Andrew Farley uses his Paltrow Co. credit card to purchase merchandise from Paltrow Co. for $16,600. On February 10, Farley is billed for the amount due of $16,600. On February 12, Farley pays $8,300 on the balance due. On March 10, Farley is billed for the amount due, including interest at 4% per month on the unpaid balance as of February 12. Prepare the entries on Paltrow Co.’s books related to the transactions that occurred on January 10, February 12, and March 10.
No.
Date
Account Titles and Explanation…
Journalize the entries to record the following selected transactions. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
Mar.
1
Sold $63,300 of merchandise on account, subject to a sales tax of 6%. The cost of the merchandise sold was $37,540.
23
Paid $38,530 to the state sales tax department for taxes collected.
Chapter 16 Solutions
College Accounting, Chapters 1-27
Ch. 16 - There are two methods of accounting for...Ch. 16 - The matching principle states that debits should...Ch. 16 - Using the percentage of sales method, the balance...Ch. 16 - When an account is written off under the allowance...Ch. 16 - Each time an account is written off under the...Ch. 16 - The dollar difference between Accounts Receivable...Ch. 16 - A business has an ending balance in Accounts...Ch. 16 - A business has an ending balance in Accounts...Ch. 16 - Prob. 4MCCh. 16 - Under the allowance method, when an account is...
Ch. 16 - Prob. 1CECh. 16 - Tonis Tech Shop has total credit sales for the...Ch. 16 - Fionas Pharmacy uses the direct write-off method...Ch. 16 - Prob. 1RQCh. 16 - Prob. 2RQCh. 16 - Prob. 3RQCh. 16 - Prob. 4RQCh. 16 - Prob. 5RQCh. 16 - Prob. 6RQCh. 16 - Prob. 7RQCh. 16 - Under the allowance method, what journal entries...Ch. 16 - Prob. 9RQCh. 16 - Prob. 10RQCh. 16 - CALCULATION OF NET REALIZABLE VALUE L. R. Updike...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES Rossins...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF RECEIVABLES...Ch. 16 - COLLECTION OF ACCOUNTS WRITTEN OFFALLOWANCE METHOD...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - DIRECT WRITE-OFF METHOD Maria Rivera, owner of...Ch. 16 - COLLECTION OF ACCOUNT WRITTEN OFFDIRECT WRITE-OFF...Ch. 16 - UNCOLLECTIBLE ACCOUNTSALLOWANCE METHOD Pyle...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - AGING ACCOUNTS RECEIVABLE An analysis of the...Ch. 16 - DIRECT WRITE-OFF METHOD Williams Hendricks...Ch. 16 - CALCULATION OF NET REALIZABLE VALUE Mary Martin...Ch. 16 - UNCOLLECTIBLE ACCOUNTS-PERCENTAGE OF SALES Nicoles...Ch. 16 - UNCOLLECTIBLE ACCOUNTS-PERCENTAGE OF RECEIVABLES...Ch. 16 - COLLECTION OF ACCOUNT WRITTEN OFFALLOWANCE METHOD...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - DIRECT WRITE-OFF METHOD Brent Mussellman, owner of...Ch. 16 - COLLECTION OF ACCOUNT WRITTEN OFFDIRECT WRITE-OFF...Ch. 16 - UNCOLLECTIBLE ACCOUNTSALLOWANCE METHOD Lewis...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - AGING ACCOUNTS RECEIVABLE An analysis of the...Ch. 16 - DIRECT WRITE-OFF METHOD Lee and Chen Distributors...Ch. 16 - Sam and Robert are identical twins. They opened...Ch. 16 - Martel Co. has 320,000 in Accounts Receivable on...Ch. 16 - Prob. 2CPCh. 16 - At the end of 20-3, Martel Co. had 410,000 in...
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- COLLECTION OF ACCOUNTS WRITTEN OFFALLOWANCE METHOD Julia Alvarez, owner of Alvarez Rentals, uses the allowance method in accounting for uncollectible accounts. Record the following transactions in general journal form:arrow_forwardUNCOLLECTIBLE ACCOUNTSALLOWANCE METHOD Pyle Nurseries used the allowance method to record the following transactions, adjusting entries, and closing entries during the year ended December 31, 20--. REQUIRED 1. Open the three selected general ledger accounts. 2. Enter the transactions and the adjusting and closing entries in a general journal (page 6). After each entry, post to the appropriate selected accounts. 3. Determine the net realizable value as of December 31.arrow_forwardNash's Trading Post, LLC uses the allowance method for estimating uncollectible accounts. Prepare journal entries to record the following transactions: (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record jour entries in the order presented in the problem.) Do not give answer in imagearrow_forward
- Explain why companies must use the Allowance Method, and not the Direct Write-Off Method, when dealing with collectible accounts. Then show a journal entry writing off an account with both methods. PLEASE DO NOT HANDWRITE THE RESPONSE!!arrow_forwardEntries for uncollectible accounts, using direct write-off methodJournalize the following transactions in the accounts of ChampionMedical Co., a medical equipment company that uses the direct write-offmethod of accounting for uncollectible receivables: Jan. 19. Sold merchandise on account to Dr. Dale Van Dyken, $30,000.The cost of the merchandise sold was $20,500. July 7. Received $12,000 from Dr. Dale Van Dyken and wrote off the remainder owed on the sale of January 19 as uncollectible. Nov. 2. Nov. Reinstated the account of Dr. Dale Van Dyken that had been written off on July 7 and received $18,000 cash in full payment.arrow_forwardPresented below are two independent situations. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (a) On January 6, Brumbaugh Co. sells merchandise on account to Pryor Inc. for $7,000, terms 2/10, n/30. On January 16, Pryor Inc. pays the amount due. Prepare the entries on Brumbaugh’s books to record the sale and related collection. (Omit cost of goods sold entries.) (b) On January 10, Andrew Farley uses his Paltrow Co. credit card to purchase merchandise from Paltrow Co. for $9,000. On February 10, Farley is billed for the amount due of $9,000. On February 12, Farley pays $5,000 on the balance due. On March 10, Farley is billed for the amount due, including interest at 1% per month on the unpaid balance as of February 12. Prepare the entries on Paltrow Co.’s books related to the transactions that occurred on January 10, February 12, and March 10. (Omit cost of goods…arrow_forward
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