SAP is a global company headquartered in Germany. SAP is a market leader in enterprise application software and also a leading experience management, analytics, and business intelligence company. In a recent annual report, it disclosed the following information concerning its allowance for doubtful accounts (euros in millions denoted as €):

Required:
1. Record summary journal entries related to the allowance for doubtful accounts for the current year.
2. If SAP had written off an additional €10 million of accounts receivable during the period, how would receivables, net and net income have been affected? Explain why.

Transcribed Image Text:

Balance at Beginning of Period €99 Charged to Costs and Expenses €18 Amounts Written Off (€10) Balance at End of Period €107