Journalize these transactions 8 On June 30th Valeros Inc sol

8. On June 30th Valeros Inc. sold finished goods to a customer for 25,000. The customer signed a 9-month note at 5% yearly interest. On the maturity date, the customer did not pay, so Gamma billed him for the full amount of the dishonoured note. Valeros at the same time recorded an allowance for doubtful accounts of 3,500. After a few unsuccessful collection attempts, the customer eventually paid 15,500.

Solution

JUNE 30 ACCOUNTS RECEIVABLE A/C   DR. 25000

                                  TO SALES A/C            CR.   25000

                2. ACCOUNTS RECEIVABLE A/C   DR. 938

                        TO INTEREST A/C            CR.938

                3. ALLOWANCE FOR DOUBTFUL DEBTS A/C   DR. 3500

                                  TO ACCOUNTS RECEIVABLE   A/C      CR.3500

4.                               CASH A/C DR. 15500

                                         TO ACCOUNTS RECEIVABLE CR. 15500