Business Administration 2257 Midterm: Midterm Cheat Sheet
10 Dec 2015
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Debit revenue accounts with credit balances, credit income summary [c1a] or credit revenue accounts with debit balances, debit income summary [c1b] Credit expense accounts with debit balances, debit income summary [c2a] or debit expense accounts with credit balances, credit income summary [c2b] Subtotal income summary, and record taxes to income tax expense and payable [c3] Credit income tax expense, debit income summary [c4] Skip 3 and 4 if there is a net loss. Do not touch petty cash for expense transactions. E/b is given to you in the case (outstanding a/r at end of fye) Dr. allowance for doubtful accounts (contra asset), cr. A4da (if only part of amount is recovered, only reverse the collectable amount) Calculate ending balance of a4da (e/b a4da = e/b of accounts receivable x estimated %) Calculate bad debt expense (bad debt expense = e/b a4da t/b a4da)
