Accounting Assignment Example | Topics and Well Written Essays - 1250 words - 3

Accounting - Assignment Example Prepare the entries on Pierson Co.s books related to the transactions that occurred on January 10, February 12, and March 10. If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 1% of net sales, and (2) 10% of accounts receivable. If Allowance for Doubtful Accounts has a debit balance of $200 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 0.75% of net sales and (2) 6% of accounts receivable. Credit terms are 2/10, n/30. At March 31, Allowance for Doubtful Accounts has a credit balance of $1,200 prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The companys estimate of bad debts is as follows. At December 31, 2009, Braddock Company had a balance of $15,000 in the Allowance for Doubtful Accounts. During 2010, Braddock wrote off accounts totaling $13,000. One of those accounts ($1,800) was later collected. At December 31, 2010, an aging schedule indicated that the balance in the Allowance for Doubtful Accounts should be $19,000. On December 31, 2010, Jarnigan Co. estimated that 2% of its net sales of $400,000 will become uncollectible. The company recorded this amount as an addition to Allowance for Doubtful Accounts. On May 11, 2011, Jarnigan Co. determined that Terry Fryes account was uncollectible and wrote off $1,100. On June 12, 2011, Fryes paid the amount previously written off. On March 3, Cornwell Appliances sells $680,000 of its receivables to Marsh Factors Inc. Marsh Factors assesses a finance charge of 3% of the amount of receivables sold. Prepare the entry on Cornwell Appliances books to record the sale of the receivables. (For multiple debit/credit entries, list amounts from largest to