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8-32 CH AP TE R 8 Accounting for Receivables solved.docx -...

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QNo 1:Answersa.Prepare the journal entries to record each of these five transactions.Assume that no cash discounts were taken on the collections of accountsreceivable.
DateAccounts & ExplanationDebit Rs.Credit Rs.1Accounts Receivable3,700,000Sales Revenue3,700,000(To record Sales)2Sales Return and Allowances50,000Accounts Receivable50,000(To record Sales return)3Cash2,810,000Accounts Receivable2,810,000(To record Collection)4Allowance for Doubtful Accounts90,000Accounts Receivable90,000(To record Write off)5(1)Accounts Receivable29,000Allowance for Doubtful Accounts29,000(To record reinstated a/c )5(2)Cash29,000Accounts Receivable29,000(To record cash received)
b.Enter the January 1, 2020, balances in Accounts Receivable and Allowancefor Doubtful Accounts, post the entries to the two accounts (use T-accounts), and determine the balances.
Prepare the journal entry to record bad debt expense for 2020, assumingthat an aging of accounts receivable indicates that expected bad debts areR$115,000.
d.Compute the accounts receivable turnover for 2020 assuming theexpected bad debt information provided in (c).

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Term
Spring
Professor
N/A
Tags
Revenue, 1986, Uncollectible Accounts, Double entry bookkeeping system

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