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Journal entries for a business, bad debts

On January 1, 2003, Marina Clothing Company had Accounts Receivable of
$54,200 and Allowance for Doubtful Accounts of $4,700. Marina Clothing
Company prepares financial statements annually. During the year the following
selected transactions occurred.

Jan. 5 Sold $6,000 of merchandise to Cheryl Crow Company, terms n/30.

Feb. 2 Accepted a $6,000, 5-month, 13% promissory note from Cheryl Crow Company for balance due.

12 Sold $3,000 of merchandise to Patricia Patton Company and accepted Patton's $3,000, 4-month, 10% note for the balance due.

26 Sold $10,000 of merchandise to Faith Hill Company, terms n/10.

Apr. 5 Accepted a $10,000, 3-month, 8% note from Faith Hill Company for balance due

12 Collected Patton Company note in full.

June 2 Collected Cheryl Crow Company note in full.

July 5 Faith Hill dishonors its note of April 5. It is expected that Faith Hill will eventually pay the amount owed.

15 Sold $5,000 of merchandise to Schoenig Company and accepted Schoenig Company's $5,000, 3-month, 12% note for the amount due.

Oct. 15 Schoenig Company's note was dishonored. Schoenig Company is bankrupt, and there is no hope of future settlement.

Instructions: Journalize the transactions.

Solution Summary

Journal entries shown for you.