MB-3 Reporting Accounts Receivable and Recording Wirite-Offs Using the Allowance

Question

MB-3 Reporting Accounts Receivable and Recording Wirite-Offs Using the Allowance Method LO 8.2] s of $950,000 in Accounts Receivable and Allowance for Doubtful Accounts. On January 2, 2015, the company learns that certain customer On December 31, accounts are not collectible, so management authorizes a write-off of these accounts totaling $25,000. a. What amount would the company report as its net accounts receivable on December 31, 20142 Prepare the journal entry to write off the accounts on January 2. 2015. (f no entry is required for a ransaction/event, select "No Journal Entry Required" in the first account field.) b. Journal entry worksheet Record the $25,000 write-off of certain customer accounts which are not January 02, 2015

Explanation / Answer

a) Net account receivable on december 31,2014 = (950000-85000) = 865000

b) Journal entry :

Date Accounts & explanation debit credit Jan 02,2015 Allowance for doubtful accounts 25000 Account receivable 25000

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