Answer:
Journal 1 : February 2, 2021 Provide services to customers on account for $26,000
Trade Receivables $26,000 (debit)
Revenue $26,000 (credit)
Journal 2 :July 23, 2021 Receive $17,000 from customers on account.
Bank $17,000 (debit)
Trade Receivables $17,000 (credit)
Journal 3 :December 31, 2021 Estimate that 20% of uncollected accounts will not be received
Profit and Loss $ 1,800 (debit)
Allowance for Doubtful Debts $ 1,800 (credit)
(26,000-17,000)×20%
Journal 4 :April 12, 2022 Provide services to customers on account for $39,000
Trade Receivables $39,000 (debit)
Revenue $39,000 (credit)
Journal 5 :June 28, 2022 Receive $6,000 from customers for services provided in 2021.
Bank $6,000 (debit)
Trade Receivables $6,000 (credit)
Journal 6 :September 13, 2022 Write off the remaining amounts owed from services provided in 2021.
Bad Debts $3,000 (debit)
Trade Receivables $3,000 (credit)
(26,000-17,000-6,000)
Journal 7 :October 5, 2022 Receive $35,000 from customers for services provided in 2022
Bank $35,000 (debit)
Trade Receivables $35,000 (credit)
Journal 8 :December 31, 2022 Estimate that 20% of uncollected accounts will not be received.
Profit and Loss $800 (debit)
Allowance for Doubtful Debts $800 (credit)
39,000-35,000×20% = 800
Explanation:
"Services to customers on account"
Recognise an Asset - Trade Receivables and also Recognise Revenue
"Receipt of Cash from Receivables"
Recognise the Assets of Cash and De-recognise the Trade Receivable
"Estimate of uncollected accounts"
Recognise an Expense in the Profit and Loss and recognise a Contra - Account Allowance for Doubtful Debts to De-recognise the Trade Receivables
