Question

During August 2018​, Bingham Company recorded the​ following: bullet Sales of $ 68 comma 900 ​($ 55 comma 000 on​ account; $ 13 comma 900 for​ cash). Ignore Cost of Goods Sold. bullet Collections on​ account, $ 45 comma 100. bullet ​Write-offs of uncollectible​ receivables, $ 1 comma 680. bullet Recovery of receivable previously written​ off, $ 300. Requirements 1. Journalize Bingham​'s transactions during August 2018​, assuming Bingham uses the direct​ write-off method. 2. Journalize Bingham​'s transactions during August 2018​, assuming Bingham uses the allowance method.

Answer 1

Step-by-step explanation:

Direct Method

Aug

a

Dr Accounts Receivable 55,000

Dr Cash 13,900

Cr Sales 68,900

b

Dr Cash 45,100

Cr Accounts Receivable 45,100

c

Dr Bad Debt Expense 1,680

Cr Accounts Receivable 1,680

d

Dr Accounts Receivable 300

Cr Bad Debt Expense 300

Dr Cash 300

Cr Accounts Receivable 300

Allowance Method

a

Dr Accounts Receivable 55,000

Dr Cash 13,900

Cr Sales 68,900

b

Dr Cash 45,100

Cr Accounts Receivable 45,100

c

Dr Allowance for Doubtful debts 1,680

Cr Accounts Receivable 1,680

d

Dr Accounts Receivable 300

Cr Allowance for Doubtful debts 300

Dr Cash 300

Cr Accounts Receivable 300