>> Accounting Basics
Q1) Saku Restaurant made credit card sales of $10 500. The credit card company charges a 4% processing fee on all credit card sales
a. Prepare the journal entry necessary to record the sales using the "gross" method.
b. Prepare the journal entry necessary to record the sales using the "net" method.
Q2) An aging analysis on June 30 of the accounts receivable of Sung Corporation indicates that uncollectible accounts amount to $8600. Prepare the entry to record bad debits expense under each of the following independent assumptions
a. Allowance for Bad Debits has a credit balance of $1800 before adjustment.
b. Allowance for Bad Debits has debit balance of $1400 before the adjustment.
Q3) Windy Corporation has an account receivable balance currently of $50800. An account receivable from Tom Novak of $4400 is deemed to be uncollecttible and is written off. Windy Corporation uses the "Direct Method"
a. Prepare the journal entry to record the written off.
b. Tom Novak brought is=n $3700 as a partial settlement of his account receivable to Windy Corporation (Two journal entries are required).
Q4) Colby Company which uses the Allowance Method has Accounts Receivable of $165 000, and an Allowance for Bad Debits credit balance of $8400. The company determined that Irma Hegerman, one of its credit customer, had a balance of $7200 that had to be written off. Colby Company received a year later from Hegerman a partial payment of $6450.
a. Prepare the journal entry to record the write off $7200.
b. Prepare the journal entries (two are required) to record the partial receipt of the previously written off balance.
Q5) Rich Importing Company received a 90-day, $30 000 note with an interest rate of 11% for the sake if an engine.
a. Prepare the journal entry to record receipt of the note by Rich Importing Company.
b. Prepare the journal to record the collection of the maturity value of the note at the maturity date.