Question

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BACK NEXT CALCULATOR PRINTER VERSION Exercise 8-4 (Part Level Submission) At the beginning of the current period, Crane Company had balances in Accounts Receivable of $192,800 and in Allowance for Doubtful Accounts of $8,520 (credit). During the period, it had credit sales of $722,500 and collections of $708,940. It wrote off as uncollectible accounts receivable of $7,972. However, a $3,275 account previously written off as uncollectible was recovered before the end of the current period. Uncollectible accounts are estimated to total $22,740 at the end of the period. (Omit cost of goods sold entries.) (a-d) (a) Prepare the entries to record sales and collections during the period. Prepare the entry to record the write-off of uncollectible accounts during (b) the period. Prepare the entries to record the recovery of the uncollectible account (c) during the period. () Prepare the entry to record bad debt expense for the period. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit (a) (To record sales) (To record collection) (b) (c) (To reinstate account previously written off) (To record collection) (d)

Answer 1

Solution:

Credit S.no. a. Journal Entries - Crane company Particulars Accounts Receivable Dr To Sales revenue Debit $722,500 $722,500 $708,940 Cash Dr To Accounts receivable $ 708,940 60 b. $7,972 Allowance for Doubtful Accounts Dr To Accounts Receivable 1.972 $3,275 Accounts Receivable Dr To Allowance for Doubtful Accounts Cash Dr To Accounts Receivable $3,275 $18,917 Bad Debt Expense Dr ($22740 - $8520+ $7972- $3275) To Allowance for Doubtful Accounts $18,917 72 73 91 92 93 -708 (2) Sheet181 (5) ) Sheet707 Sheet709 Sheet8 (2)