Question
The following summarizes the aging of accounts receivable for Johnston Supplies, Inc. as of July 31, 2019: Number of Days Unpaid Total Accounts Receivable Historical
The following summarizes the aging of accounts receivable for Johnston Supplies, Inc. as of July 31, 2019: Number of Days Unpaid Total Accounts Receivable Historical % Uncollectible Not yet due $ 126,500 2 % 1-30 days past due 89,200 12 % 31-60 days past due 53,600 18 % Over 60 days past due 31,800 35 % Required: The unadjusted balance of the Allowance for Doubtful Accounts of Johnston Supplies, Inc. is a credit balance in the amount of $28,947 on July 31, 2019.
a. Prepare the required adjusting entry to record Bad Debt Expense for the year. Johnston Supplies, Inc. writes off $3,081 of uncollectible accounts on August 15, 2019.
b. Prepare the required adjusting entry to record the write-off.
c. Use a T-account to determine the account balance in the Allowance for Doubtful Accounts on August 15, 2019.
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