Prepare the journal entry to record the write-off
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Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
At the end of 2016, Splish Brothers Inc. has accounts receivable of $675,100 and an allowance for doubtful accounts of $24,370. On January 24, 2017, it is learned that the company’s receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $4,127.
(a) Prepare the
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- Hardys Landscape Services total revenue on account for 2018 amounted to 273,205. The company, which uses the allowance method, estimates bad debts at percent of total revenue on account. Required Journalize the following selected entries: 2012 Dec. 12Record services performed on account for E. E. Morton, 245. 31Record the adjusting entry for Bad Debts Expense. 31Record the closing entry for Bad Debts Expense. 2013 Feb. 18Write off the account of E. E. Morton as uncollectible, 245. Check Figure Adjusting entry amount, 1,366.03At the end of 2016, Swifty Corporation has accounts receivable of $673,200 and an allowance for doubtful accounts of $24,010. On January 24, 2017, it is learned that the company's receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $4,147. (a) Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (b) What is the cash realizable value of the accounts receivable before the write-off and after the write-off? Before Write-Off After Write-Off Cash realizable value 2$At the end of 2016, Whispering Winds Corp. has accounts receivable of $749,900 and an allowance for doubtful accounts of $23,580. On January 24, 2017, it is learned that the company's receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $4,564. (a) Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (b) What is the cash realizable value of the accounts receivable before the write-off and after the write-off? Before Write-Off After Write-Off Cash realizable value 2$
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- At the end of 2021, Kingbird Co. has accounts receivable of $691,500 and an allowance for doubtful accounts of $25,740. On January 24, 2022, it is learned that the company’s receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $3,943. (a)Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Enter an account title Enter a debit amount Enter a credit amount Enter an account title Enter a debit amount Enter a credit amount (b)What is the cash realizable value of the accounts receivable before the write-off and after the write-off? Before Write-Off After Write-Off Cash realizable value $Enter a dollar amount $Enter a dollar amountAt the end of 2021, Sage Hill Co. has accounts receivable of $704,700 and an allowance for doubtful accounts of $26,850. On January 24, 2022, it is learned that the company’s receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $4,384.(a)Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Enter an account title Enter a debit amount Enter a credit amount Enter an account title Enter a debit amount Enter a credit amount (b)What is the cash realizable value of the accounts receivable before the write-off and after the write-off? Before Write-Off After Write-Off Cash realizable value $Enter a dollar amount $Enter a dollar amountAt the end of 2022, Sheridan Co. has accounts receivable of $807,800 and an allowance for doubtful accounts of $58,300. On January 24, 2023, the company learns that its receivable from Megan Gray is not collectible, and management authorizes a write-off of $6,000. (a) Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit