Brief Exercise 8-3

At the end of 2013, Morley Co. has accounts receivable of $707,900 and an allowance for doubtful accounts of $24,260. On January 24, 2014, it is learned that the companys receivable from Spears Inc. is not collectible and therefore management authorizes a write-off of $4,050.

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

Account titles and explanation	Debit	Credit

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

Before Write-off	After Write-off
$	$