Bridgeport Company sold $8,780 of its specialty shelving to Elkins Office Supply Co. on account. Bridgeport estimates that an additional $215 in allowances will be granted to Elkins. Prepare the entries when (a) Bridgeport makes the sale. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) (b) Bridgeport grants an allowance of $722 when some of the shelving does not meet exact specifications but still could be sold by Elkins. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) (c) at year-end. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Question

Business

Clarence Mcconnell

13 October, 10:29

Bridgeport Company sold $8,780 of its specialty shelving to Elkins Office Supply Co. on account. Bridgeport estimates that an additional $215 in allowances will be granted to Elkins. Prepare the entries when (a) Bridgeport makes the sale. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) (b) Bridgeport grants an allowance of $722 when some of the shelving does not meet exact specifications but still could be sold by Elkins. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) (c) at year-end. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

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Answers (1)

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Felix Cohen · Answer 1

Statement is given below.

Explanation:

Prepare the necessary journal entries as shown below:

Date Accounts Title and Explanation Ref. Debit Credit

a Accounts Receivable $ 8:780

Sales Revenue $ 8380

(To record the sales made on account)

Sales Returns and Allowances $ 215

Provision for Sales Return and Allowances $ 215

vTo record the estimated allowance on sales

b Sales Returns and Allowances ($722-$215) $ 507

Provision for Sales Return and Allowances $ 215

Accounts Receivable $ 722

(To record the allowance granted towards sales

returns)

c No entry

(Since the cash is not received and hence no

adjustment needed)