Journalize the entries to record the following:
A. Check No. 6172 is issued to establish a petty cash fund of $1,000.
B. The amount of cash is the petty cash fund is now $239.16. Check No. 6319 is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $379.10; miscellaneous selling expense, $216.25; Miscellaneous administrative expense, $143.06.(Since the amount of the check to replenish the fund plus the balance in the fund do not equal $1,000, record the discrepancy in the cash short and over account.)
The cash account for Bonita Medical Co. at September 30, 2008, indicated a balance of $5,335.30. The bank statement indicated a balance of $5,604.60 on September 30, 2008. Comparing the bank statement and the accompanying canceled checks and memoranda with the records revealed the following reconciling items:
a. Checks outstanding totaled $4,790.45.
b. A deposit of $9,226.15, representing receipts of September 30, had been made too late to appear on the bank statement.
c. The bank had collected $7,725 on a note left for collection. The face of the note was $7,500.
d. A check for $4,315 returned with the statement had been incorrectly recorded by Bonita Medical Co. as $3415. The check was for the payment of an obligation to Rowe Co. for the purchase of office equipment on account.
e. A check drawn for $230 had been erroneously charged by the bank as $2,300.
f. Bank service charges for September amounted to $50.
1. Prepare a bank reconciliation
2. Journalize the necessary entries. The accounts have not been closed.
The following selected transactions were completed by Cactus Co., a supplier of Velcro for clothing:
Dec. 13. Received from Lady Ann’s Co., on account, a $60,000, 90 day, 9% note dated December 13.
31. Recorded an adjusted entry for accrued interest on the note of December 13.
Dec. 12. Received payment of note and interest form Lady Ann’s Co.
Journalize the transactions.
The following transactions were completed by Clark Management Company during the current fiscal year ended December 31:
July 5. Received 70% of the $21,000 owed by Dockins Co., a bankrupt business, and wrote off the remainder as uncollectible.
Sept. 21 reinstated the account of Bart Tiffany, which had been written of in the preceding year as uncollectible. Journalized the receipt of $ 4,875 cash in full payment of Tiffany’s account.
Oct. 19. Wrote off the $6,275 balance owed by Ski Time Co., which has not assets.
Nov. 6. Reinstated the account of Kirby Co., which had been written off in the preceding year as uncollectible. Journalized the receipt of $4,750 cash in full payment of the account.
Dec. 31. Wrote off the following accounts as uncollectible (compound entry): Maxie Co., $2,150; Kommers Co., $3,600; Helena Distributors, $5,500; Ed Ballantyne, $1,750.
31. Based on an analysis of the $815,240 of accounts receivable, it was estimated that $16,750 will be uncollectible. Journalized the adjusting entry.
1. Record the January 1 credit balance of $12,550 in a t-Account for Allowance for Doubtful Accounts.
2. Journalize the transactions. Post each entry that affects the following selected T-accounts and determine the new balances:
Allowance for Doubtful Accounts
Bad Debt Expenses
3. Determine the expected net realizable value of the accounts receivable as of December 31.
4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivable, the adjusting entry on December 31 had been based on an estimated expense of ¼ of 1% of the net sales of $7,126,000 for the year, determine the following:
a. Bad debt expense for the year.
b. Balance in the allowance account after the adjustment of December 31.
c. Expected net realizable value of the accounts receivable as of December 31.