Ask Question
19 September, 05:38

Required information [The following information applies to the questions displayed below.] The following events occur for Morris Engineering during 2021 and 2022, its first two years of operations. February 2, 2021 Provide services to customers on account for $26,000. July 23, 2021 Receive $17,000 from customers on account. December 31, 2021 Estimate that 20% of uncollected accounts will not be received. April 12, 2022 Provide services to customers on account for $39,000. June 28, 2022 Receive $6,000 from customers for services provided in 2021. September 13, 2022 Write off the remaining amounts owed from services provided in 2021. October 5, 2022 Receive $35,000 from customers for services provided in 2022. December 31, 2022 Estimate that 20% of uncollected accounts will not be received. Required: 1. Record transactions for each date. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)

+4
Answers (1)
  1. 19 September, 06:54
    0
    Journal 1 : February 2, 2021 Provide services to customers on account for $26,000

    Trade Receivables $26,000 (debit)

    Revenue $26,000 (credit)

    Journal 2 : July 23, 2021 Receive $17,000 from customers on account.

    Bank $17,000 (debit)

    Trade Receivables $17,000 (credit)

    Journal 3 : December 31, 2021 Estimate that 20% of uncollected accounts will not be received

    Profit and Loss $ 1,800 (debit)

    Allowance for Doubtful Debts $ 1,800 (credit)

    (26,000-17,000) * 20%

    Journal 4 : April 12, 2022 Provide services to customers on account for $39,000

    Trade Receivables $39,000 (debit)

    Revenue $39,000 (credit)

    Journal 5 : June 28, 2022 Receive $6,000 from customers for services provided in 2021.

    Bank $6,000 (debit)

    Trade Receivables $6,000 (credit)

    Journal 6 : September 13, 2022 Write off the remaining amounts owed from services provided in 2021.

    Bad Debts $3,000 (debit)

    Trade Receivables $3,000 (credit)

    (26,000-17,000-6,000)

    Journal 7 : October 5, 2022 Receive $35,000 from customers for services provided in 2022

    Bank $35,000 (debit)

    Trade Receivables $35,000 (credit)

    Journal 8 : December 31, 2022 Estimate that 20% of uncollected accounts will not be received.

    Profit and Loss $800 (debit)

    Allowance for Doubtful Debts $800 (credit)

    39,000-35,000*20% = 800

    Explanation:

    "Services to customers on account"

    Recognise an Asset - Trade Receivables and also Recognise Revenue

    "Receipt of Cash from Receivables"

    Recognise the Assets of Cash and De-recognise the Trade Receivable

    "Estimate of uncollected accounts"

    Recognise an Expense in the Profit and Loss and recognise a Contra - Account Allowance for Doubtful Debts to De-recognise the Trade Receivables
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Required information [The following information applies to the questions displayed below.] The following events occur for Morris ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers