Accounting for Doubtful Accounts At the beginning of the current period, Fassi Co. had a balance of
Question:
Accounting for Doubtful Accounts
At the beginning of the current period, Fassi Co. had a balance of $800,000 in Accounts Receivable and a $44,000 credit balance in Allowance for Doubtful Accounts.In the period, it had net credit sales of $1,900,000 and collections of $2,042,000. It wrote off accounts receivable of $58,000. After a $4,000 account was written off as uncollectible, it was subsequently collected. This is in addition to the other cash collections. Based on an aging schedule, uncollectible accounts are estimated to be $36,000 at the end of the period.
Instructions:
(a) Record sales and collections journal entry in the period.
(b) Record the write off of uncollectible accounts in the period. (Journal entry)
(c) Record the collection of the account previously written off.(Journal entry)
(d) Record the bad debt expense adjusting entry for the period. (Journal entry)
(e) What is the bad debt expense on the income statement for the period? (Calculation)