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than U EX 8-14 Entries for bad debt expense under the direct write-off and allowance methods The following selected transactions were taken from the records
than U EX 8-14 Entries for bad debt expense under the direct write-off and allowance methods The following selected transactions were taken from the records of Rustic Tables the year ending December 31 June & Wrote off account of Kathy Quantel, $8,440 write-off method Obj.5 $11,090 higher Aup 14. Recelved 3,000 s partiel pyment on the $12,500 account of Rosalie Oakes Wrote off the remaining balance as uncollectible Oct. 16. Recelved the $8,440 from Kathy Quantel whose account had been written off on June 8. Reinstated the account and recorded the cash receipt Dec 31. Wote off the following accounts as uncollectible (record as one journal entry) Wade Dolan Greg Gagne Amber Kisko Shannon Poole Niki Spence $4,600 3,600 ,150 2,975 6,630 31. If necessary, recovd the year-end adjusting entry for uncollectible accounts a. Journalize the transactions under the direct write-off method. b. Journalize the transactions under the allowance method, assuming that the allowance account hacd a beginning balance of $36,000 at the beginning of the year and the company uses the analysis of receivables method. Rustic Tables Company prepared the following aging schedule for its accounts receivable ing Class (Number of Days Past Due)on December 31 0-30 days 31-60 days 61-90 days 91-120 days More than 120 days Total receivables Uncollectible Accounts 320,000 110,000 24,000 18,000 43,000 $515,000 1% 10 75 How much higher (lower) would Rustic Tables' net income have been under the direct write-off method than under the allowance method? c
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