Accounts Receivable Allowance Journal Entry: Lambert, Inc. is a manufacturer of
ID: 2341804 • Letter: A
Question
Accounts Receivable Allowance Journal Entry: Lambert, Inc. is a manufacturer of men's casual clothing.
Lambert uses the allowance method to record doubtful accounts for financial statement reporting.
The balance in the allowance for doubtful accounts at January 1, year 2, was a debit balance of $20,000.
The activity in this account during year 2 consisted of the write-off of accounts valued at $29,000 and a recovery of $5,000 in accounts that were written off in previous years. T
he accounting staff at Lambert has determined that the balance in the allowance for doubtful accounts at December 31, year 2 should be $60,000.
Prepare the journal entry that records the bad debt expense for year 2, if any. • Enter the correct account name as it appears from the list provided. •
Enter the correct debit and credit values in the appropriate cells. Account name Debit Credit
2. Use the following list to enter the correct account name: • Accounts receivable • Allowance for doubtful accounts • Bad debt expense • Cash • Miscellaneous income • Miscellaneous expense • No entry required • Sales
Explanation / Answer
Note: The above journal entry is recorded to write off accounts under allowance method.
Journal entry for Recovery of accounts: The follwing two entries are recorded incase of recovery of accounts under allowance method,
1.
2.
ACCOUNT NAME DEBIT CREDIT Allowance for doubtfull accounts 29,000 Accounts receivable 29,000 (To record write-off of accounts.)Related Questions
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