Reference no: EM131113583
Bad-Debt Reporting Presented below is information related to the Accounts Receivable accounts of Gulistan Inc. during the current year 2010.
1. An aging schedule of the accounts receivable as of December 31, 2010, is as follows.
2. The Accounts Receivable control account has a debit balance of $372,400 on December 31, 2010.
3. Two entries were made in the Bad Debt Expense account during the year: (1) a debit on December31 for the amount credited to Allowance for Doubtful Accounts, and (2) a credit for $3,240 on November 3, 2010, and a debit to Allowance for Doubtful Accounts because of a bankruptcy.
4. The Allowance for Doubtful Accounts is as follows for 2010.Allowance for Doubtful AccountsNov. 3 Uncollectible accounts Jan. 1 Beginning balance 8,750Written off 3,240 Dec. 31 5% of $372,400 18,620
5. A credit balance exists in the Accounts Receivable (60-90 days) of $4,840, which represents an advance on a sales contract. Assuming that the books have not been closed for 2010, make the necessary correct ingentries
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