Clarissa Company has credit sales of $550,000 during 2019 and estimates at the end of 2019 that

Question:

Clarissa Company has credit sales of $550,000 during 2019 and estimates at the end of 2019 that 2.5% of these credit sales will eventually default. Also, during 2019 a customer defaults on a $775 balance related to goods purchased in 2018. Prior to the write-off for the $775 default, Clarissa's and allowance for doubtful accounts balances were $402,000 and $129 (credit), respectively.
Required:
1. Prepare the journal entry to record the defaulted account.
2. Prepare the adjusting entry to record the bad debt expense for 2019?
Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...