(Learning Objective 4: Applying the allowance method to account for uncollectibles) Gray and Dumham, a law fi...
Question:
(Learning Objective 4: Applying the allowance method to account for uncollectibles)
Gray and Dumham, a law fi rm, started 20X6 with accounts receivable of $31,000 and an allowance for uncollectible accounts of $4,000. The 20X6 service revenues on account totaled
$175,000, and cash collections on account totaled $128,000. During 20X6, Gray and Dumham wrote off uncollectible accounts receivable of $2,800. At December 31, 20X6, the aging of accounts receivable indicated that Gray and Dumham will not collect $1,850 of its accounts receivable.
Journalize Gray and Dumham’s
(a) service revenue,
(b) cash collections on account,
(c) write-offs of uncollectible receivables, and
(d) uncollectible-account expense for the year.
Explanations are not required. Prepare a T-account for Allowance for Uncollectible Accounts to show your computation of uncollectible-account expense for the year.
Step by Step Answer:
Financial Accounting International Financial Reporting Standards
ISBN: 9780273777809
1st Global Edition
Authors: Walter T Harrison, Charles Horngren, Bill Thomas, Themin Suwardy