Question

2)    Complete T-Accounts. Proper entries and proper formatting will both be marked.

a) Prepare T-Accounts only for the following entries.                                                           

            Bad Debt Expense      500

                        ADA                            500

            COGS                         400

                        Inventory                     400     

b)    Prepare T-Accounts to reflect the entries used to close any of the above balances in the accounts in part a) as required, include the creation of the required interim account used to close out accounts, and the subsequent closing of that account.                         

Answer 1

Both the parts (a) & (b) of Qus 2 is done in One excel Format which in attached herein.

Where as in Option (B)

Bad Debt Expense Account shall to transferred to Profit & loss A/c as it is eexpense for the Year.

COGS shall be transferred to Trading A/c.

Both of the Above A/c shall be closed by passing Closing/Transfering entry.

And remaining accounts i.e ADA & Inventory shall be reflected in Balance Sheet as both are the Balnce sheet items.