Purchase Solution

Journal entries for a business, bad debts

Not what you're looking for?

Ask Custom Question

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.

Purchase this Solution

Solution Summary

Journal entries shown for you.

Purchase this Solution


Free BrainMass Quizzes
Marketing Management Philosophies Quiz

A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.

Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

Production and cost theory

Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.

Lean your Process

This quiz will help you understand the basic concepts of Lean.

Understanding Management

This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.