Question

The balance sheet of Starsky Company at December 31, 2019, includes the following.

Accounts receivable	$ 182,100
Less: Allowance for doubtful accounts	17,300
	$ 164,800

Transactions in 2020 include the following:

1. Accounts receivable of $78,000 were collected
2. Accounts receivable of $60,000 were collected, in which 2% sales discounts were granted.
3. A $5,300 customer account that was written off the books as worthless in 2019 was reinstated.
4. The $5,300 was received from the customer.
5. Customer accounts of $17,500 were written off during the year.
6. At year-end, Allowance for Doubtful Accounts was estimated to need a balance of $20,000. This estimate is based on an analysis of aged accounts receivable.

Instructions: Journalize the above transactions.

Answer 1

1) Cash 78000

To accounts receivable 78000

2) cash 58800

discount on sales 1200

to accounts receivable 60000

remaining journal entries are given below