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Journal Entries for Accounts Receivable Management

1) Enzo Computers made two sales on July 1 and July 17 and received payments on July 10 and July 30 which should be recorded through journal entries. 2) Based on the information provided about Ellen Danica's salary, merchandise purchases and sales, collections, and inventory, an estimate can be calculated for the accounts receivable balance that should appear in the ledger and any apparent shortages. 3) Journal entries need to be prepared to record bad debt expense for Mark Lester Company assuming either 1% of net sales or 5% of accounts receivable.

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Kim Punay
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15 views3 pages

Journal Entries for Accounts Receivable Management

1) Enzo Computers made two sales on July 1 and July 17 and received payments on July 10 and July 30 which should be recorded through journal entries. 2) Based on the information provided about Ellen Danica's salary, merchandise purchases and sales, collections, and inventory, an estimate can be calculated for the accounts receivable balance that should appear in the ledger and any apparent shortages. 3) Journal entries need to be prepared to record bad debt expense for Mark Lester Company assuming either 1% of net sales or 5% of accounts receivable.

Uploaded by

Kim Punay
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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PROBLEM 1

Presented below is information from Enzo Computers lncorporated.

July 1 Sold P50,000 of computers to Robertson Company with terms 3/15, n/60. Enzo
uses the gross method to record cash discounts.
10 Enzo received payment from Robertson for the full amount owed from the
July transactions.
17 Sold P150, 000 in computers and peripherals to The Clark Store
with terms of 2/10,n/30.
30 The Clark Store paid Enzo for its purchase of July 17. 

Required: 
Prepare the necessary journal entries for Enzo Computers.

PROBLEM 2
Your accounts receivable clerk, Ellen Danica, to whom you pay a salary of P1,500 per month,
has just purchased  a new Acura. You decided to test the accuracy of the accounts receivable
balance of P82,000 as shown in the ledger.
The following information is available for your first year in business.
1. Collections from customers P198,000 
2. Merchandise purchased 320,000 
3. Ending merchandise inventory 90,000
4.  Goods are marked to sell at 40% above cost 
Required:
Compute an estimate of the ending balance of accounts receivable from customers that should be
appear in the ledger and any apparent shortages. Assume that all sales are made on account.
PROBLEM 3

Mark Lester Company reports the following financial information before adjustments. 

Debit Credit

Accounts Receivable P250,000


Allowance for Doubtful Accounts           P 4,000
Sales Revenue(all in credit)         150,000
    Sales Return and Allowances 25,000           

Required:

Prepared the journal entry to record Bad Debt Expense assuming Mark Lester Company
estimates bad debts at

a. 1% of net sales
b. 5% of accounts receivable    

PROBLEM 4
At the end of 2021, Kimberli company has accounts receivable of P800,000 and an allowance for
doubtful accounts of P40,000. On January 16, 2021, Kimberli Company determined that its
receivable form Ramirez Company of P6,000 will not be collected, and management authorized
its write-off.
Required:
A. Prepare the journal entry to Kimberli company to write off the Ramirez receivable.
B. What is the net realizable value of Kimberli Company’s account receivable before the
write-off of the Ramirez Company receivable?
C. What is the net realizable value of Kimberli company’s accounts receivable after the
write–off of the Ramirez receivable?

PROBLEM 5

The following information relates to Liezl Co.’s account receivable for 2020:

Accounts receivable, 1/1/2020   P550,000


Credit sales for 2020   3,550,000
Sales returns for 2020       55,000
Accounts written off during 2020       40,000
Collections from customers during 2020 2,150,000
Estimated future sales returns at 12/31/2020       50,000
Estimated uncollectible accounts at 12/31/2020     140,000

What amount should Liezl report for account receivable, before allowances for sales
returns and uncollectible accounts, at December 31, 2020?

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