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nayelirios
nayelirios
26.02.2020 • 
Business

Vulcan Service Co. experienced the following transactions for Year 1, its first year of operations:

Provided $84,000 of services on account.

Collected $50,400 cash from accounts receivable.

Paid $30,000 of salaries expense for the year.

Adjusted the accounts using the following information from accounts receivable aging schedule:

Number of Days Past Due Amount Percent Likely to Be Uncollectible Allowance Balance
Current $24,864 0.01
0-30 1,680 0.05
31-60 2,352 0.10
61-90 2,016 0.30
Over 90 days 2,688 0.50

Required:

a. Record the above transactions in general journal form and post to T-accounts.

b. Prepare the income statement for Vulcan Service Co. for Year 1.

c. What is the net realizable value of the accounts receivable at December 31, Year 1?

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