50.1K

Verified Solution

Link Copied!

On September 30, 2020, the balance in Siakam Supplies Limiteds (SSL) accounts receivable account was $87,340 and the allowance for doubtful accounts had a credit balance of $5,500. SSL uses the aging of accounts receivable method to estimate its uncollectible accounts and applies percentages based on the age of the accounts receivable at year-end, as follows:

• 0-60 days: 5%
• 61-90 days: 15%
• Over 90 days: 25%

In October, SSL had the following transactions pertaining to receivables:

Oct	11	Received bankruptcy notice from customer Green Gardens, Inc.; balance receivable of $6,140 was written off.
	17	Credit sales totaling $17,000 was billed to customers.
	31	Prepared the adjusting entry related to bad debts. The aging of accounts receivable at October 31, 2020 was as follows:

		0 - 60 days:	$55,400
		61 - 90 days:	$20,600
		> 90 days:	$7,200

Required:

a. Record SSLs transactions and required adjustments for October. Round to the nearest dollar.

Date	Account	Debit	Credit
October 11	Blank 1. Fill in the blank, read surrounding text.	Blank 2. Fill in the blank, read surrounding text.
	Blank 3. Fill in the blank, read surrounding text.		Blank 4. Fill in the blank, read surrounding text.

Date	Account	Debit	Credit
October 17	Blank 5. Fill in the blank, read surrounding text.	Blank 6. Fill in the blank, read surrounding text.
	Blank 7. Fill in the blank, read surrounding text.		Blank 8. Fill in the blank, read surrounding text.

Date	Account	Debit	Credit
October 31	Blank 9. Fill in the blank, read surrounding text.	Blank 10. Fill in the blank, read surrounding text.
	Blank 11. Fill in the blank, read surrounding text.		Blank 12. Fill in the blank, read surrounding text.

Show your calculations for the adjustment recorded on October 31 by filling in the following blanks (enter absolute values only):

Desired ending balance of the AFDA account:		$ Blank 13. Fill in the blank, read surrounding text.
Beginning balance of the AFDA account:	$ Blank 14. Fill in the blank, read surrounding text.
Accounts receivable written-off:	Blank 15. Fill in the blank, read surrounding text.	Blank 16. Fill in the blank, read surrounding text.
Required adjustment:		$ Blank 17. Fill in the blank, read surrounding text.

b. Assume the allowance doubtful account had a debit balance of $6,200 on September 30, 2020. Record the adjusting entry recorded on October 31. Round to the nearest dollar.

Date	Account	Debit	Credit
October 31	Blank 18. Fill in the blank, read surrounding text.	Blank 19. Fill in the blank, read surrounding text.
	Blank 20. Fill in the blank, read surrounding text.		Blank 21. Fill in the blank, read surrounding text.

Show your calculations for the adjustment recorded on October 31 by filling in the following blanks (enter absolute values only):

Desired ending balance of the AFDA account:		$ Blank 22. Fill in the blank, read surrounding text.
Beginning balance of the AFDA account:	$ Blank 23. Fill in the blank, read surrounding text.
Accounts receivable written-off:	Blank 24. Fill in the blank, read surrounding text.	Blank 25. Fill in the blank, read surrounding text.
Required adjustment:		$ Blank 26. Fill in the blank, read surrounding text.

Answer & Explanation Solved by verified expert

See Answer