Larry Libbey is a lawyer in Calgary. He uses the direct write-off method to account for uncollectible receivables because he rarely has delinquent accounts.
At May 31, Libbey's accounts receivable totalled $32,000. During June, he earned revenue of $40,000 on account and collected $36,000 on account. He also wrote off uncollectible receivables of $6,000 on June 12.
1. Use the direct write-off method to journalize Libbey's write-off of the uncollectible receivables.
2. What is Libbey's balance of Accounts Receivable at June 30? Does he expect to collect the full amount? Explain.