faithcalhoun
24.10.2019 •
Business
Exercise 7-6 percent of sales method; write-off lo p3 at year-end (december 31), chan company estimates its bad debts as 0.70% of its annual credit sales of $641,000. chan records its bad debts expense for that estimate. on the following february 1, chan decides that the $321 account of p. park is uncollectible and writes it off as a bad debt. on june 5, park unexpectedly pays the amount previously written off. prepare chan's journal entries for the transactions.
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Ответ:
Explanation:
The journal entries are shown below:
December 31
Bad debt expense A/c Dr $448,700 ( $641,000 × 0.70%)
To Allowance for Doubtful debts $448,700
(Being bad debt expense is recorded)
February 1
Allowance for Doubtful debts A/c Dr $321
To Accounts receivable $321
(Being uncollectible amount is recorded)
June 5
Allowance for Doubtful debts A/c Dr $321
To Accounts receivable $321
(Being uncollectible amount is recorded)
June 5
Cash A/c Dr $321
To Accounts receivable $321
(Being previously written off recorded)
Ответ: