Question

In: Accounting

On December 31, 2020, Pina Colada Corp. estimated that 4% of its net accounts receivable of...

On December 31, 2020, Pina Colada Corp. estimated that 4% of its net accounts receivable of $455,200 will become uncollectible. The company recorded this amount as an addition to Allowance for Doubtful Accounts. The allowance account had a zero balance before adjustment on December 31, 2020. On May 11, 2021, Pina Colada Corp. determined that the Jeff Shoemaker account was uncollectible and wrote off $2,276. On June 12, 2021, Shoemaker paid the amount previously written off.

Prepare the journal entries on December 31, 2020, May 11, 2021, and June 12, 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Date

Account Titles and Explanation

Debit

Credit

Dec. 31, 2020May 11, 2021June 12, 2020June 12, 2021

Dec. 31, 2020May 11, 2021June 12, 2020June 12, 2021

Dec. 31, 2020May 11, 2021June 12, 2020June 12, 2021

(To reverse write-off)

Dec. 31, 2020May 11, 2021June 12, 2020June 12, 2021

(To record collection of write-off)

Solutions

Expert Solution

Date Account Debit Credit
Dec 31 Bad debts expense 18,208
Allowance for Doubtful Accounts 18,208
(455200*4%)
May 11 Allowance for Doubtful Accounts 2276
Accounts Receivable 2276
June 12 Allowance for Doubtful Accounts 2276
Accounts Receivable 2276
June 12 Cash 2276
Accounts Receivable 2276

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Pina Colada Corp. had the following long-term receivable account balances at December 31, 2016. Notes receivable...
Pina Colada Corp. had the following long-term receivable account balances at December 31, 2016. Notes receivable - Sale of division $1,809,000 Notes receivable - Employees 399,000 Transactions during 2017 and other information relating to Pina's long-term receivables were as follows: 1. The $1,809,000 note receivable is dated May 1, 2016, bears interest at 8%, and represents the balance of the consideration received from the sale of Pina's electronics division to Blossom Company. Principal payments of $603,000 plus appropriate interest are...
Problem 8-1A At December 31, 2018, Pina Colada Corp. reported the following information on its balance...
Problem 8-1A At December 31, 2018, Pina Colada Corp. reported the following information on its balance sheet. Accounts receivable $952,000 Less: Allowance for doubtful accounts 84,000 During 2019, the company had the following transactions related to receivables. 1. Sales on account $3,869,880 2. Sales returns and allowances 51,000 3. Collections of accounts receivable 2,831,000 4. Write-offs of accounts receivable deemed uncollectible 87,000 5. Recovery of bad debts previously written off as uncollectible 28,000 a. Prepare the journal entries to record...
Clark Company estimated the net realizable value of its accounts receivable as of December 31, 2019,...
Clark Company estimated the net realizable value of its accounts receivable as of December 31, 2019, to be $175,000, based on an aging schedule of accounts receivable. Clark has also provided the following information: The allowance for doubtful accounts balance on January 1, 2019 was $17,000. The accounts receivable balance on December 31, 2019 was $187,000. Uncollectible accounts receivable written off during 2019 totaled $13,000. How much is Clark's 2019 bad debt expense? A. 8,000 B. 16,000 C. 12,000 D....
Pina Colada Corp. purchased equipment on January 1, 2021 for $148,500. It is estimated that the...
Pina Colada Corp. purchased equipment on January 1, 2021 for $148,500. It is estimated that the equipment will have a $8,250 salvage value at the end of its 5-year useful life. It is also estimated that the equipment will produce 165,000 units over its 5-year life. Answer the following independent questions. Compute the amount of depreciation expense for the year ended December 31, 2021 using the straight-line method of depreciation. Straight-line method $enter the depreciation expense under the straight-line method...
You are auditing Accounts Receivable of HUSKY Corp. as of December 31, 2013. The Accounts Receivable...
You are auditing Accounts Receivable of HUSKY Corp. as of December 31, 2013. The Accounts Receivable general ledger balance is $4,263,919.52. Access the textbook's resources on the Cengage website. The files are labeled "HUSKY Unpaid Invoices 2013" (the 12/31/2013, unpaid invoices), "HUSKY Shipping File 2013" (contains the shipment numbers and shipment dates for those invoices), and "HUSKY Credit Limit 2013" (contains each customer's credit limit). Sales are made FOB shipping point. The auditor has verified that the last shipment in...
Pina Colada started her own consulting firm, Pina Colada Corp., on May 1, 2022. The unadjusted...
Pina Colada started her own consulting firm, Pina Colada Corp., on May 1, 2022. The unadjusted trial balance at May 31 is as follows. Pina Colada Corp. Trial Balance May 31, 2022 Account Number Debit Credit 101 Cash $ 4,770 112 Accounts Receivable 6,360 126 Supplies 2,014 130 Prepaid Insurance 3,816 149 Equipment 12,240 201 Accounts Payable $ 2,332 209 Unearned Service Revenue 2,120 311 Common Stock 21,356 400 Service Revenue 7,950 726 Salaries and Wages Expense 3,604 729 Rent...
(Chapter 3 LO3) The ledger of Pina Colada Corp. on March 31 of the current year...
(Chapter 3 LO3) The ledger of Pina Colada Corp. on March 31 of the current year includes the selected accounts, shown below, before quarterly adjusting entries have been prepared. Debit Credit Prepaid Insurance $ 1,800 Supplies 3,400 Equipment 18,750 Accumulated Depreciation—Equipment $ 8,600 Notes Payable 21,000 Unearned Rent Revenue 9,900 Rent Revenue 61,000 Interest Expense 0 Salaries and Wages Expense 11,000 An analysis of the accounts shows the following. The equipment depreciates $300 per month. 2. One-third of the unearned...
Kyla Co. prepared an aging of its accounts receivable at December 31, 2020 and determined that...
Kyla Co. prepared an aging of its accounts receivable at December 31, 2020 and determined that the net realizable value of the receivables was $580,000. Additional information for calendar 2020 follows: Allowance for doubtful accounts, Jan 1 $68,000 (cr.) Uncollectible account written off during year 46,000 Bad debt expense for 2020 28,000 Uncollectible accounts recovered during year 10,000            At the year end December 31, 2020, Kyla Co.’s Accounts receivable balance should be 1) $640,000.00 2) $658,000.00 3) $644,000.00 4)...
The stockholders’ equity accounts of Pina Colada Corp. on January 1, 2017, were as follows. Preferred...
The stockholders’ equity accounts of Pina Colada Corp. on January 1, 2017, were as follows. Preferred Stock ( 7%, $ 100 par noncumulative,  4,150 shares authorized) $ 249,000 Common Stock ($ 5 stated value,  345,000 shares authorized) 1,437,499 Paid-in Capital in Excess of Par Value—Preferred Stock 12,450 Paid-in Capital in Excess of Stated Value—Common Stock 552,000 Retained Earnings 694,000 Treasury Stock ( 4,150 common shares) 33,200 During 2017, the corporation had the following transactions and events pertaining to its stockholders’ equity. Feb....
The stockholders’ equity accounts of Pina Colada Corp. on January 1, 2017, were as follows. Preferred...
The stockholders’ equity accounts of Pina Colada Corp. on January 1, 2017, were as follows. Preferred Stock (7%, $100 par noncumulative, 4,150 shares authorized) $249,000 Common Stock ($5 stated value, 345,000 shares authorized) 1,437,499 Paid-in Capital in Excess of Par Value—Preferred Stock 12,450 Paid-in Capital in Excess of Stated Value—Common Stock 552,000 Retained Earnings 694,000 Treasury Stock (4,150 common shares) 33,200 During 2017, the corporation had the following transactions and events pertaining to its stockholders’ equity. Feb. 1 Issued 4,540...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT