Entries for Uncollectible Receivables, using Allowance Method

Journalize the following transactions in the accounts of Zippy Interiors Company, a restaurant supply company that uses the allowance method of accounting for uncollectible receivables:

May 24	Sold merchandise on account to Old Town Cafe $17,200. The cost of goods sold was $12,400.
Sept. 30	Received $3,800 from Old Town Cafe and wrote off the remainder owed on the sale of May 24 as uncollectible.
Dec. 7	Reinstated the account of Old Town Cafe that had been written off on September 30 and received $13,400 cash in full payment.

For a compound transaction, if an amount box does not require an entry, leave it blank.

May 24-sale
May 24-cost
Sept. 30
Dec. 7-reinstated
Dec. 7-collection