2. Prepare the journal entries for items (a)-(j). (If no entry is required for a transaction/event, select "No Journal Entry Required" inthe first account field. Do not round intermediate calculations.)View transaction listJournal entry worksheet123 4567811>....Record service revenue of $40,000 sold on account during January.Note: Enter debits before credits.TransactionGeneral JournalDebitCredita.Record entryClear entryView general journal [The following information applies to the questions displayed below.]Web Wizard, Inc., has provided information technology services for several years. For the first two months of the currentyear, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter,the company switched to the aging of accounts receivable method. The company entered into the following partial list oftransactions during the first quarter.a. During January, the company provided services for $40,000 on credit.b. On January 31, the company estimated bad debts using 1 percent of credit sales.c. On February 4, the company collected $20,000 of accounts receivable.d. On February 15, the company wrote off a $100 account receivable.e. During February, the company provided services for $30,000 on credit.f. On February 28, the company estimated bad debts using 1 percent of credit sales.g. On March 1, the company loaned $2,400 to an employee, who signed a 6% note, due in 6 months.h. On March 15, the company collected $100 on the account written off one month earlier.i. On March 31, the company accrued interest earned on the note.j. On March 31, the company adjusted for uncollectible accounts, based on an aging analysis (below). Allowance forDoubtful Accounts has an unadjusted credit balance of $1,200.Number of Days UnpaidCustomerTotal0-3031-6061-90Over 90Alabama Tourism$4200$4100$80$20Bayside BungalowsOthers (not shown to save space)Xciting Xcursions4004006,80040017,0008,4001,000800400$ 7,300$ 8,480$ 1,020$ 1, 20040%Total Accounts Receivable$18,000Estimated Uncollectible (%)2%10%20%

Journal entry:-Way of recording any transaction of a company with debit and credit side. It works on…

punts receivable method. The company entered into the following partial list of d services for $40,000 on credit. d bad debts using 1 percent of credit sales. d $20,000 of accounts receivable. off a $100 account receivable. ed services for $30,000 on credit. ted bad debts using 1 percent of credit sales. 400 to an employee, who signed a 6% note, due in 6 months. $100 on the account written off one month earlier. terest earned on the note. or uncollectible accounts, based on an aging analysis (below). Allowance for credit balance of $1,200. Number of Days Unpaid Total 0-30 31-60 61-90 Over 90 200 199 80 20

punts receivable method. The company entered into the following partial list of d services for $40,000 on credit. d bad debts using 1 percent of credit sales. d $20,000 of accounts receivable. off a $100 account receivable. ed services for $30,000 on credit. ted bad debts using 1 percent of credit sales. 400 to an employee, who signed a 6% note, due in 6 months. $100 on the account written off one month earlier. terest earned on the note. or uncollectible accounts, based on an aging analysis (below). Allowance for credit balance of $1,200. Number of Days Unpaid Total 0-30 31-60 61-90 Over 90 200 199 80 20

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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[The following information applies to the questions displayed below.] Web Wizard, Inc., has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. During January, the company provided services for $30,000 on credit. On January 31, the company estimated bad debts using 1 percent of credit sales. On February 4, the company collected $15,000 of accounts receivable. On February 15, the company wrote off a $200 account receivable. During February, the company provided services for $20,000 on credit. On February 28, the company estimated bad debts using 1 percent of credit sales. On March 1, the company loaned $2,800 to an employee, who signed a 6% note, due in 6…
[The following information applies to the questions displayed below.] Web Wizard, Inc., has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. During January, the company provided services for $30,000 on credit. On January 31, the company estimated bad debts using 1 percent of credit sales. On February 4, the company collected $15,000 of accounts receivable. On February 15, the company wrote off a $200 account receivable. During February, the company provided services for $20,000 on credit. On February 28, the company estimated bad debts using 1 percent of credit sales. On March 1, the company loaned $2,800 to an employee, who signed a 6% note, due in 6…
Web Wizard, Inc., has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. During January, the company provided services for $40,000 on credit. On January 31, the company estimated bad debts using 1 percent of credit sales. On February 4, the company collected $20,000 of accounts receivable. On February 15, the company wrote off a $100 account receivable. During February, the company provided services for $30,000 on credit. On February 28, the company estimated bad debts using 1 percent of credit sales. On March 1, the company loaned $2,400 to an employee, who signed a 6% note, due in 6 months. On March 15, the company collected $100 on the account written off…
Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $31,000 on credit. b. On January 31, the company estimated bad debts using 2 percent of credit sales. c. On February 4, the company collected $15,500 of accounts receivable. d. On February 15, the company wrote off $150 account receivable. e. During February, the company provided services for $21,000 on credit. f. On February 28, the company estimated bad debts using 2 percent of credit sales. g. On March 1, the company loaned $2,600 to an employee, who signed a 6% note, due in 6 months. h. On March 15, the company collected $150…
Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $45,000 on credit. b. On January 31, the company estimated bad debts using 2 percent of credit sales. c. On February 4, the company collected $22,500 of accounts receivable. d. On February 15, the company wrote off $200 account receivable. e. During February, the company provided services for $35,000 on credit. On February 28, the company estimated bad debts using 2 percent of credit sales.. g. On March 1, the company loaned $2,000 to an employee, who signed a 6% note, due in 6 months. h. On March 15, the company collected $200 on…
Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $31,000 on credit. b. On January 31, the company estimated bad debts using 2 percent of credit sales. c. On February 4, the company collected $15,500 of accounts receivable. d. On February 15, the company wrote off $150 account receivable. e. During February, the company provided services for $21,000 on credit. f. On February 28, the company estimated bad debts using 2 percent of credit sales. g. On March 1, the company loaned $2,600 to an employee, who signed a 6% note, due in 6 months. h. On March 15, the company collected $150…
Required information [The following information applies to the questions displayed below.] Web Wizard, Inc., has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $44,000 on credit. b. On January 31, the company estimated bad debts using 1 percent of credit sales. c. On February 4, the company collected $22,000 of accounts receivable. d. On February 15, the company wrote off a $150 account receivable. e. During February, the company provided services for $34,000 on credit. f. On February 28, the company estimated bad debts using 1 percent of credit sales. g. On March 1, the company loaned $2,200 to an…
Innovative Tech Inc. (ITI) has been using the percentage of credit sales method to estimate bad debts. During November, ITI sold services on account for $130,000 and estimated that 3/4 of 1 percent of those sales would be uncollectible. Required: 1. Prepare the November adjusting entry for bad debts. 2. Starting in December, ITI switched to using the aging method. At its December 31 year-end, total Accounts Receivable is $89,900, aged as follows: (1) 1–30 days old, $74,000; (2) 31–90 days old, $12,000; and (3) more than 90 days old, $3,900. The average rate of uncollectibility for each age group is estimated to be (1) 12 percent, (2) 24 percent, and (3) 48 percent, respectively. Prepare a schedule to estimate an appropriate year-end balance for the Allowance for Doubtful Accounts. 3. Before the end-of-year adjusting entry is made, the Allowance for Doubtful Accounts has a $1,550 credit balance at December 31. Prepare the December 31 adjusting entry. 4. Show how the various accounts…
Required information [The following information applies to the questions displayed below.] Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $44,000 on credit. b. On January 31, the company estimated bad debts using 1 percent of credit sales. c. On February 4, the company collected $22,000 of accounts receivable. d. On February 15, the company wrote off $150 account receivable. e. During February, the company provided services for $34,000 on credit. f. On February 28, the company estimated bad debts using 1 percent of credit sales. g. On March 1, the company loaned $2,200 to an…
Required Information [The following information applies to the questions displayed below.] Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $40,000 on credit. b. On January 31, the company estimated bad debts using 1 percent of credit sales. c. On February 4, the company collected $20,000 of accounts receivable. d. On February 15, the company wrote off $100 account receivable. e. During February, the company provided services for $30,000 on credit. f. On February 28, the company estimated bad debts using 1 percent of credit sales. g. On March 1, the company loaned $2,400 to an…
Required information [The following information applies to the questions displayed below.] Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $46,000 on credit. b. On January 31, the company estimated bad debts using 1 percent of credit sales. c. On February 4, the company collected $23,000 of accounts receivable. d. On February 15, the company wrote off $100 account receivable. e. During February, the company provided services for $36,000 on credit. f. On February 28, the company estimated bad debts using 1 percent of credit sales. g. On March 1, the company loaned $2,400 to an…
Innovative Tech Inc. (ITI) has been using the percentage of credit sales method to estimate bad debts. During November, ITI sold services on account for $100,000 and estimated that ½ of 1 percent of those sales would be uncollectible. Required: Prepare the November adjusting entry for bad debts. Starting in December, ITI switched to using the aging method. At its December 31 year-end, total Accounts Receivable is $89,000, aged as follows: (1) 1–30 days old, $75,000; (2) 31–90 days old, $10,000; and (3) more than 90 days old, $4,000. The average rate of uncollectibility for each age group is estimated to be (1) 10 percent, (2) 20 percent, and (3) 40 percent, respectively. Prepare a schedule to estimate an appropriate year-end balance for the Allowance for Doubtful Accounts. Before the end-of-year adjusting entry is made, the Allowance for Doubtful Accounts has a $1,600 credit balance at December 31. Prepare the December 31 adjusting entry. Show how the various accounts related…