Question

Listed below are selected transactions for the Gotham City Garbage Service, which is accounted for in an Enterprise Fund. All amounts are in thousands of dollars.

Transactions:
1. Services of $8,250 were provided and billed to outside customers.
2. Services of $1,500 were provided and billed to the General Fund.
3. $1,500 was collected from other funds, and $7,500 was collected on account.
4. $100 of accounts receivable were written off as uncollectible.
5. Estimated bad debts for the year were $220.
Requirement:
1. Prepare the journal entries required in the Enterprise Fund. If no entry is required, state "No entry required" and explain why.
2. Compute the amount of sales revenues that should be reported for the Enterprise Fund.

Answer 1

journal entries

1.

Trade Receivable - Outside Customers $8,250 (debit)

Revenue $8,250 (credit)

2.

Trade Receivable - General Fund $1,500 (debit)

Revenue $1,500 (credit)

3.

Cash $9,000 (debit)

Trade Receivables $7,500 (credit)

Revenue $1,500 (credit)

4.

Bad Debts Written off $100 (debit)

Trade Receivables $100 (credit)

5.

Doubtful Debts $220 (debit)

Provision for Doubtful Debts $220 (credit)

Amount of sales revenues :

Revenue = $8,250 + $1,500 + $1,500

= $ 11,250

Step-by-step explanation:

For amount of sales revenues ADD Revenue recorded in Journals 1 to 3