.Gregory Ltd uses the ageing of accounts receivable method for estimating doubtful debts. The balance of the Allowance for Doubtful Debts account on 1 July 2020 had a credit balance of $9,300. The company is registered for goods and services tax (GST). GST rate is 10%.
All transactions below relate to Gregory Ltd’s uncollectable accounts for the financial year ended 30 June 2021.
July 18
Wrote off the $495 account of B. Betty as uncollectable.
Oct. 19
Re-established the account of C. Casy and recorded the collection of $2,530 in full payment of his account, which had been written off previously.
Jan. 31
Received 20% of the $2,200 balance owed by D. Delois and wrote off the remainder as uncollectable.
June 30
The estimate of uncollectable accounts is based on an ageing of accounts receivable and $18,260 of the accounts receivable as at 30 June was estimated to be uncollectable.
Gregory Ltd has a receivable balance of $650,000 on the 30 June 2021. All Accounts Receivable figures are GST Inclusive.
REQUIRED:
Prepare journal entries for each of the transactions/events above. Narrations are not required for journal entries.
Show the Statement of Financial Position (Balance Sheet) extract for accounts receivable as at 30
