CopyThis Corporation is the company that made the photocopier popular, but since then has grown a new business related to business process outsourcing. It recently disclosed the following information concerning the Allowance for Doubtful Accounts on its Form 10-K annual report.

Allowance for Doubtful Accounts
(dollars in millions)
Year	Beginning Balance	Increases for Bad Debt Expense	Decreases for Write-Offs	Ending Balance
2018	$ 63	$ 18	$ 21	$ 60
2017	68	20	a	63
2016	78	b	29	68

Required:

1-a. Prepare a T-account for the Allowance for Doubtful Accounts and enter into it the 2018 amounts from the above schedule. The balance at the beginning of each year in the Allowance for Doubtful Accounts is a credit balance.

1-b. Write the T-account in equation format to prove that the above items account for the changes in the account.

2. Record summary journal entries for 2018 related to (i) estimating bad debt expense and (ii) writing off specific balances.

3. Supply the missing information for 2017 and 2016.

4. If CopyThis had written off an additional $24 (thousand) of accounts receivable during the period, by how much would Net Receivables have decreased? How much would Net Income have decreased?

Req 1A:

Prepare a T-account for the Allowance for Doubtful Accounts and enter into it the 2018 amounts from the above schedule. The balance at the beginning of each year in the Allowance for Doubtful Accounts is a credit balance. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

Allowance for Doubtful Accounts
Debit		Credit
Beginning Balance
Ending Balance

Req 1B:

Write the T-account in equation format to prove that the above items account for the changes in the account. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

Beginning Balance	+				=	Ending Balance
	+				=

req 2A:

Record the adjusting entry for bad debts for 2018.

Record the adjusting entry for write-off of specific customer balances for 2018.

req 3:

Supply the missing information for 2017 and 2016. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

Allowance for Doubtful Accounts	Balance at Beginning of Year	Additions Charged to Bad Debt Expense	Deductions From Allowance		Balance at End of Year
2017	$68	$20		=	$63
2016	78		29	=	68

Req 3b:

If CopyThis had written off an additional $24 of accounts receivable during 2016, by how much would its Net Accounts Receivable have decreased? How much would the write-off have decreased Income from Operations?

Net Receivables
Net Income