M8-4 Recording Recoveries Using the Allowance Method [LO 8-2] On December 31, 20

Question

M8-4 Recording Recoveries Using the Allowance Method [LO 8-2] On December 31, 2014, Extreme Fitness has adjusted balances of $990,000 in Accounts Receivable and $93,000 in Allowance for Doubtful Accounts. On January 2, 2015, the company leans that certain customer accounts are not collectible, so management authorizes a write-off of these accounts totaling $29,000. Assume that on February 2, 2015, Extreme Fitness received a payment of $2,400 from one of the customers whose balance had been written off. Prepare the journal entries to record this transaction. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the reversal of a customer account previously written off in the amount of $2,400. Note: Enter debits before credits. ctio General Journal Debit Credit Record entry Clear entry View general journal References M8-4 Recording Recoveries Using the Allowance Method [LO 8-2 General Journal

Explanation / Answer

TRN General Journal Debit Credit 1) Accounts receivable 2,400 Allowance for Doubtful accounts 2,400 (reversal of customer account) 2) Cash 2,400 Account receivable 2,400 (receipt of cash from customer)

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