Pool Corporation is the world’s largest wholesale distributor of swimming pool s
ID: 2333961 • Letter: P
Question
Pool Corporation is the world’s largest wholesale distributor of swimming pool supplies and equipment. Pool Corp. reported the following information related to bad debt estimates and write-offs for the current year.
Prepare journal entries for the bad debt expense adjustment and total write-offs of bad debts for the current year. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Pool Corp. reduces net sales by the amount of sales returns and allowances, cash discounts, and credit card fees. Bad debt expense is recorded as part of selling and administrative expense. Assume that gross sales revenue for the month was $137,256, bad debt expense was $146, sales discounts were $1,134, sales returns were $856, and credit card fees were $1,849. What amount would Pool Corp. report for net sales for the month?
Pool Corporation is the world’s largest wholesale distributor of swimming pool supplies and equipment. Pool Corp. reported the following information related to bad debt estimates and write-offs for the current year.
Explanation / Answer
1) Journal entry :
2) Net Sales = Gross sales-Sales discount-Sales return-Credit card fees
= 137256-1134-856-1849
Net Sales = $133417
Date account and explanation debit credit Bad debt expense 2958 Allowance for doubtful accounts 2958 (To record bad debt expense) Allowance for doubtful accounts 4160 Account receivable 4160 (To record write off)