Question
Mephisto Inc. generated $2.75 million in credit sales during the current year. The balance of the allowance for doubtful accounts at December 31 is
Mephisto Inc. generated $2.75 million in credit sales during the current year. The balance of the allowance for doubtful accounts at December 31 is $2,500 debit. Accounts receivable at December 31 consists of the following: 1-30 days 31-60 days 61-90 days Over 90 days Account Classification Amount Uncollectible $350,000 1.50% 180,000 3% 55,000 5% 21,000 25% Required- a) Calculate and record the journal entry for bad debt expense for the current year using the aging of accounts receivable approach. b) Mephisto has decided to write off $15,000 of the accounts that were over 90 days old. Record the journal entry. c) One of the customers whose $2,200 account was written off paid in full. Record the journal entry (entries).
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started