Crystal Clear Cleaning uses the allowance method to estimate bad debts. Consider the following April 2025 transactions
Question:
Crystal Clear Cleaning uses the allowance method to estimate bad debts. Consider the following April 2025 transactions for Crystal Clear Cleaning
Requirements
1. Prepare all required journal entries for Crystal Clear. Omit explanations.
2. Show how net accounts receivable would be reported on the balance sheet as of April 30, 2025
Transcribed Image Text:
Apr. 1 10 12 Performed cleaning service for Debbie's D-list for $13,000 on account with terms n/20. 28 28 29 30 Borrowed money from First Regional Bank, $30,000, making a 180-day, 12% note. After discussions with customer More Shine, Crystal Clear has determined that $230 of the receivable owed will not be collected. Wrote off this portion of the receivable. 15 Sold goods to Warner for $9,000 on account with terms n/30. Cost of Goods Sold was $4,500. Sold goods to Lelaine, Inc. for cash of $2,800 (cost $840). Collected from More Shine, $230 of receivable previously written off. Paid cash for utilities of $150. Created an aging schedule for Crystal Clear Cleaning for accounts receivable. Crystal Clear determined that $7,000 of receivables outstanding for 1-30 days were 3% uncollectible, $10,000 of receivables outstanding for 31-60 days were 20% uncollectible, and $5,870 of receivables outstanding for more than 60 days were 30% uncollectible. Crystal Clear Cleaning determined the total amount of estimated uncollectible receivables and adjusted the Allowance for Bad Debts. Assume the account had an unadjusted credit balance of $260. (Round to nearest whole dollar.)
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Related Book For
Horngrens Financial And Managerial Accounting The Financial Chapters
ISBN: 9781292412320
7th Global Edition
Authors: Tracie Miller-Nobles, Brenda Mattison, Ella Mae Matsumura
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