Reference no: EM132761347

Problem - As of December 31, 2020, Blues Company reported the following account balances on its post-closing trial balance

Accounts receivable $65,230

Allowance for doubtful accounts $6,990

In 2021, Blues Company recorded the following transactions:

January 14 Sold $11,000 of goods to Calvin Manufacturing, terms 2/10, n/30.

January 18 Sold $15,000 of goods to Electric Electrical, terms 3/15, n/30.

January 20 Blues collected $39,500 of the accounts receivable outstanding as of January 1, 2021.

January 23 Blues received payment form Calvin Manufacturing.

January 25 Blues learned that GaucheHs Company had filed for bankruptcy. As a result, Blues wrote off Gaucher' s outstanding accounts receivable balance of $4,560.

February 10 Blues received payment from Electric Electrical.

March 24 As part of its bankruptcy process, Gaucher's Company agreed to pay each of its creditors 25% of their outstanding balance. Payment was received by Blues Company.

December 18 Sold $63,500 of goods to various customers, terms net 30.

December 31 Per an aging schedule, Blues determines that $3,800 of the account receivables are uncollectible.

Additional details -

1. Blues uses the gross method to record cash discounts.

2. Blues uses the allowance method for estimating uncollectible accounts at the end of each year.

REQUIRED - Prepare the journal entries required, if any, for the listed transactions. Do not worry about the cost of goods sold portion of the journal entries.