During June 2019,Andy Company Had the Following Transactions

question 98

Essay

During June 2019,Andy Company had the following transactions:
1.Sales of $185,000 ($142,000 on account,$43,000 for cash).
2.Collections on account,$128,000
3.Write-offs of uncollectible receivables,$1,900
4.Recovery of receivable previously written off,$600.
Additional information:
Ignore Cost of Goods Sold
Andy uses the allowance method for uncollectibles.
Andy estimates that 4.50% of its accounts receivable will be uncollectible.
On June 1,2019,the Accounts Receivable balance was $25,000 and the Allowance for
Bad Debts had a normal account balance of $1,125.
Requirements:
a.Prepare the journal entries for the June 2019 transactions.Because the transactions represent a summary of events,use June 30 for all dates.Omit explanations.
b.Prepare the June 30,2019 adjusting journal entry.Omit explanation.
c.What is the net realizable value of Accounts Receivable on June 30,2019 (after the adjusting journal entry has been posted)? Show computations and label your work.

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Definitions:

Representativeness

A cognitive heuristic where an individual judges the probability or frequency of an event by how much the event resembles the typical case.

Availability

The state of being able to be used or obtained; accessibility.

External Locus

A belief that outcomes of events are determined by external forces or fate, rather than one's own actions.

Learned Helplessness

A condition in which a person suffers from a sense of powerlessness, arising from a traumatic event or persistent failure to succeed.