At the end of 2013, Blackhorse Productions, Inc., used the aging of accounts receivable method
to estimate that its Allowance for Doubtful Accounts should be $20,250. The account had an
unadjusted credit balance of $11,000 at December 31, 2013.
Can you please help in preparing a journal entry:
The appropriate bad debt adjustment was recorded for the year 2013.
On January 31, 2014, an account receivable for $1,100 from March 2013 was determined to be
uncollectible and was written off.
a. The appropriate bad debt adjustment was recorded for the year 2013.
b. On January 31, 2014, an account receivable for $1,100 from March 2013 was determined to be
uncollectible and was written off.
Solution
a) Bad debts Ac Dr.... 9250
To Allowance for Doubtful Accounts.....9250
( Estimated Bad debts )
b) Allowance for doubtful Accounts Dr.....1100
To Accounts Receivable Ac........... 1100
(Amount not receivable transferred to allowance ac)
Bad debts Ac Dr. 1100
To Allowance for Doubtful Accounts ... 1100
( Amount Written Off)