For each transaction listed in E8-1, indicate the amount and direction (+ or ) of effects on

Question:

For each transaction listed in E8-1, indicate the amount and direction (+ or €“) of effects on the financial statement accounts and on the overall accounting equation.

E8-1
Blackhorse Productions, Inc., used the aging of accounts receivable method to estimate that its Allowance for Doubtful Accounts should be $ 19,750. The account had an unadjusted credit balance of $ 10,000 at that time.
Required:
Prepare journal entries for each of the following.
a. The appropriate bad debt adjustment was recorded.
b. Later, an account receivable for $ 1,000 was determined to be uncollectible and was written off.

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...