The balance sheet of Gemini, Inc., a world leader in the design and sale of telescopic equipment, reported the following information on its balance sheets for 2012 and 2011 (figures are in thousands):

In 2012, Gemini recorded $16,500 in sales (all on account), of which $900 was returned for credit. Gemini offers its customers credit terms of 2/10, n/30. Seventy-five percent of collections on accounts receivable were made within the discount period. Gemini wrote off uncollectible accounts receivable in the amount of $130 during 2012.

Requirements
1. Compute the amount of uncollectible accounts expense recorded by Gemini in 2012.
2. Compute Gemini’s cash collections from customers in 2012.
3. Open T-accounts for Accounts Receivable and Allowance for Uncollectible Accounts. Enter the beginning balances into each of these accounts. Prepare summary journal entries in the T-accounts to record the following for 2012:
a. Sales
b. Collections
c. Sales returns
d. Write-off s of uncollectible accounts
e. Uncollectible-AccountsExpense

Transcribed Image Text:

In thousands) Accounts receivable (net of allowance of $1,000 and $930) December 31,2012 $8,300 December 31, 2011 $8,500