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Required information Problem 5-22 Accounting for uncollectible accounts-two cycles using the percent of revenue allowance method LO 5-1 [The following information applies to the questions displayed below.] The following transactions apply to Jova Company for 2018, the first year of operation: 1. Issued $17,500 of common stock for cash. 2. Recognized $62,500 of service revenue earned on account. 3. Collected $56,000 from accounts receivable. 4. Paid operating expenses of $36,800. 5. Adjusted accounts to recognize uncollectible accounts expense. Jova uses the allowance method of accounting for uncollectible accounts and estimates that uncollectible accounts expense will be 2 percent of sales on account. The following transactions apply to Jova for 2019: 1. Recognized $70,000 of service revenue on account. 2. Collected $64,000 from accounts receivable. 3. Determined that $850 of the accounts receivable were uncollectible and wrote them off. 4. Collected $100 of an account that had previously been written off. 5. Paid $48,000 cash for operating expenses. 6. Adjusted the accounts to recognize uncollectible accounts expense for 2019. Jova estimates uncollectible accounts expense will be 1.0 percent of sales on account. Required Complete the following requirements for 2018 and 2019. Complete all requirements for 2018 prior to beginning the requirements for 2019. Problem 5-22 Part a a. Identify the type of each transaction (asset source, asset use, asset exchange, or claims exchange).

Required information
Problem 5-22 Accounting for uncollectible accounts-two cycles using the percent of revenue allowance
method LO 5-1
[The following information applies to the questions displayed below.]
The following transactions apply to Jova Company for 2018, the first year of operation:
1. Issued $17,500 of common stock for cash.
2. Recognized $62,500 of service revenue earned on account.
3. Collected $56,000 from accounts receivable.
4. Paid operating expenses of $36,800.
5. Adjusted accounts to recognize uncollectible accounts expense. Jova uses the allowance method of accounting for
uncollectible accounts and estimates that uncollectible accounts expense will be 2 percent of sales on account.
The following transactions apply to Jova for 2019:
1. Recognized $70,000 of service revenue on account.
2. Collected $64,000 from accounts receivable.
3. Determined that $850 of the accounts receivable were uncollectible and wrote them off.
4. Collected $100 of an account that had previously been written off.
5. Paid $48,000 cash for operating expenses.
6. Adjusted the accounts to recognize uncollectible accounts expense for 2019. Jova estimates uncollectible accounts
expense will be 1.0 percent of sales on account.
Required
Complete the following requirements for 2018 and 2019. Complete all requirements for 2018 prior to beginning the
requirements for 2019.
Problem 5-22 Part a
a. Identify the type of each transaction (asset source, asset use, asset exchange, or claims exchange).

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