1. The balance in the Allowance for Doubtful Accounts is normally credit. Explain how a debit balance could develop in Allowance for Doubtful Accounts.

2. What is the net realizable value of accounts receivable at the end of year, given the following information: Balance in Accounts Receivable at end of year, $105,000 Balance in Allowance for Doubtful Accounts, beginning of year, $2,000 debit Write-offs during year, $5,000 Bad debt expense for year, $9,000 Recoveries during year of accounts previously written-off, $2,000

3. Daniel Delinkquint owes your business $100 on account. He has moved and you have no idea how to contact him. You feel that perhaps the $100 he owes is not worth the time and effort to try to locate him. Furthermore, even if you did locate him, he probably would not pay the balance because he disputed it the last time your talked with him. An allowance has been made for this account in the past in accordance with GAAP. Give the appropriate general journal entry(ies), if any, to reflect your decision to not pursue collection from Daniel anymore. Write none if no entry is required.

4. Refer to the previous question. Suppose you later received a letter in the mail with a $100 check in it from Daniel Delinkquint, together with a note describing how he had become a born-again Christian (much like Zacchaeus) and had determined to pay off all his debts (albeit not four-fold like Zacchaeus). Give the appropriate general journal entry(ies), if any, to reflect this payment from Daniel. Write none if no entry is required.