E7-4 LO3 Accounting for Expected Credit Loss The following data were associated with the accounts receivable and uncollectible accounts of Julia Jay, Inc., during 2022: a. The opening credit balance in Loss Allowance was $600,000 at January 1, 2022. b. During 2022, the company realized that specific accounts receivable totaling $630,000 had gone bad and had been written off. C. d. 1. 2. An account receivable of $35,000 was collected during 2022. This account had previously been written off in 2021. The company decided that Loss Allowance would be $650,000 at the end of 2022. Prepare journal entries to show how these events would be recognized in the accounting system using the allowance method. Discuss the advantages of the allowance method when compared to the direct method with respect to the matching principle.

Accounting for Expected Credit Loss The following data were associated with the accounts receivable and uncollectible accounts of Julia Jay, Inc, during 2022: a. The opening credit balance in Loss Allowance was $600,000 at January 1, 2022. b. During 2022 , the company realized that specific accounts receivable totaling $630,000 had gone bad and had been written off. c. An account receivable of $35,000 was collected during 2022. This account had previously been written off in 2021. d. The company decided that Loss Allowance would be $650,000 at the end of 2022 . 1. Prepare journal entries to show how these events would be recognized in the accounting system using the allowance method. 2. Discuss the advantages of the allowance method when compared to the direct method with respect to the matching principle