On 5th August 2022, Alpha supplies sold office equipment worth K75,000 to Beta Traders on credit for 20 days. From 5th August until the payment is made, K75000 is recorded as an account receivable in the book of Alpha supplies under Beta traders account. Now assume that on 15th August 2022, Beta Traders makes a partial payment of K45000 to Alpha Suplkies.

Question

A) you are required to journalize the initial transaction of the 5th August 2022 by Alpha Supplies to record the credit sales to Beta Traders.
B) you are to journalize partial payment received by Alpha Supplies on the 15th August 2022.
C) After the updated accounts receivable, what is the remaining balance in beta traders account

Answer 1

Let's go through the transactions step by step.

A) Journal Entry for Initial Transaction on 5th August 2022

On August 5, 2022, Alpha Supplies sold office equipment worth K75,000 to Beta Traders on credit. The journal entry would be as follows:

Date: 5th August 2022
Account Titles and Explanation | Debit (K) | Credit (K)
--- | --- | ---
Accounts Receivable (Beta Traders) | 75,000 |
Sales Revenue | | 75,000
To record the credit sale of office equipment to Beta Traders.

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B) Journal Entry for Partial Payment Received on 15th August 2022

On August 15, 2022, Beta Traders made a partial payment of K45,000 to Alpha Supplies. The journal entry would be as follows:

Date: 15th August 2022
Account Titles and Explanation | Debit (K) | Credit (K)
--- | --- | ---
Cash | 45,000 |
Accounts Receivable (Beta Traders) | | 45,000
To record the partial payment received from Beta Traders.

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C) Updated Accounts Receivable Balance for Beta Traders

Initially, Beta Traders owed K75,000. After the partial payment of K45,000, the remaining balance would be calculated as follows:

Remaining Balance = Initial Amount - Payment Received

Remaining Balance = K75,000 - K45,000 = K30,000

Thus, the remaining balance in Beta Traders' account is K30,000.