Here is the problem and below that is my stated answer. The professor indicated I wasn't done. She says "after your last sentence, and then?" What other steps are there after crediting accounts receivable?

PROBLEM:

After writing off the remaining accounts receivable balance of $2,500 on a $8,000 bill on December 31, 2017, the Hospital received $500 toward payment on the account on February 26, 2018.The letter attached to the check indicated that the estate of John Doe had been probated and final disbursements from the estate were being made to the known creditors.Your accountant has deposited the $500 check and has indicated that the check would be recorded to the "nonoperating income" account.You are the Hospital's internal auditor and have come across this transaction during a review of the March 2018 financial statements.Is this transaction correct?If not, describe the process of how YOU would have receipted this payment.

MY RESPONSE:

The correct procedure would have been as follows: The $500 would have been debited against the allowance (reserve) for "Uncollectible Accounts," and the $500 would have been credited against "Accounts Receivable." Then, to adjust the "Uncollectible Accounts" to the correct amount, we would debit the $500 to decrease the "Beginning Balance" and make a corresponding entry to "Bad Debt Expense." We never write off an account directly to 'Bad Debt Expense" and we certainly never deposit payment for medical services rendered as non-operating income. Copies of the front and back of the Doe estate check, together with the accompanying letter must be part of the documentation. The patient's account balance shouldbe commensurately reversed to reinstate the account balance (from $2500 to $2000) and apply the $500 payment.

1-debit accounts receivable $500

2-credit allowance for uncollectible accounts $500

3-debit cash $500

4-credit accounts receivable $500

PROFESSOR'S RESPONSE TO ME:

on your last sentence after #4 and then .........?