At the end of 2001, Searcy Co. has accounts receivable of $700,000 and an allowance for doubtful accounts of $54,000. On January 24, 2002, it is learned that the company’s receivable from Hutley Inc. is not collectible and therefore management authorizes a write-off of $8,000.

(a) Prepare the journal entry to record the write-off.

(b) What is the cash realizable value of the accounts receivable (1) before the write-off and (2) after the write-off?