Question

Furtastic manufactures imitation fur garments. On June 1, 2018, Furtastic made a sale to Willett’s Department Store under terms that require Willett to pay $155,000 to Furtastic on June 30, 2018. In a separate transaction on June 15, 2018, Furtastic purchased brand advertising services from Willett for $13,000. The fair value of those advertising services is $5,500. Furtastic expects that 2% of all sales will prove uncollectible.

Required:
1. to 3. Prepare the journal entries to record the transactions above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Answer 1

Prepare the Journal entries :
Date	Accounts title and explaination	Debit	Credit
Jun-01	Accounts receivable	$155,000
	To sales Revenue		$155,000
	(To record sales on account)
Jun-15	Advertising expense	$5,500
	Service Revenue	$7,500
	To cash		$13,000
	(To record the advertising expense)
Jun-30	Cash	$155,000
	To Accounts receivable		$155,000
	(To record the receipt of revenue collection)