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On 30 June, the end of its financial year, Freedom Advisory Services completed an age analysis of its accounts receivable and determined that an allowance
On 30 June, the end of its financial year, Freedom Advisory Services completed an age analysis of its accounts receivable and determined that an allowance for doubtful debts of $16 250 was needed to report accounts receivable at their estimated collectable amount in the statement of financial position. Ignore GST.
Required:
- Prepare the entry to record bad debts expense assuming that the Allowance for Doubtful Debts account currently has a $2520 credit balance.
- Prepare the entry to record bad debts expense assuming that the Allowance for Doubtful Debts account currently has a $1065 debit balance.
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