70.2K

Verified Solution

Link Copied!

Give general journal entries, in proper form, for each of the following selected transactions of ABC Company. ABC uses the gross price method of accounting for sales discounts and the allowance method of accounting for uncollectible accounts receivable. Jan 15. ABC advanced $20,000 to one of its managers. The manager is allowed one interest free advance for personal use per year. Repayment is required within 90 days of the advance Jan 31 ABC recorded monthly sales (all on credit) of $350,000. Terms of all sales are 2/10, n/30 Feb 15 Accounts receivable of $600,000 was collected from January's monthly sales of which $100,000 were within the discount period Feb 20. Evidence indicates that a $5000 accounts receivable from ABC is uncollectible. The account is more than 30 days past due, and all collection efforts have failed Feb 28 ABC's accounting period end on March 28. ABC estimates that its bad debt expense for the period is $13000 Mar 1. ABC accepts a 3%, $5000 note receivable from a customer whose accounts receivable totaled $5,000 Mar 15. ABC assigns $30,000 of accounts receivable as collateral when giving on a one-month $24000, 4% note payable to a local bank April 15. ABC collects $28,000 of the receivables assigned on March 15, then used those amounts to repay principle and interest on its- one month loan from the local bank

Answer & Explanation Solved by verified expert

See Answer