there is 3 parts
Required information The following information applies to the questions displayed below) At the beginning of 2021, Brad's Heating & Air (BHA) has a balance of $24,500 in accounts receivable. Because BHA is a privately owned company, the company has used only the direct write-off method to account for uncollectible accounts However, at the end of 2021, BHA wishes to obtain a loan at the local bank, which requires the preparation of proper financial statements. This means that BHA now will need to use the allowance method. The following transactions occur during 2021 and 2022. 1. During 2021, Install air conditioning systems on account, $175,000 2. During 2021, collect $170,000 from customers on account. 3. At the end of 2021, estimate that uncollectible accounts total 20% of ending accounts receivable. 4. In 2022, customers' accounts totaling $6,500 are written off as uncollectible. Required: 1. Record each transaction using the allowance method. (If no entry is required for a particular transaction/event, select "No Journal Entry Required in the first account field.) View transaction Bat Journal entry worksheet 2 3 View transaction list Journal entry worksheet 2 3 4 During 2021, install air conditioning systems on account, $175,000. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal 4.1 2022 LUSH 2. Record each transaction using the direct write-off method. (If no entry is required for a particular transac Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet During 2021, install air conditioning systems on account, $175,000. Note: Enter debits before credits. Transaction General Journal Debit Credit Required information The following information applies to the questions displayed below.) At the beginning of 2021, Brad's Heating & Air (BHA) has a balance of $24.500 in accounts receivable. Because BHA Isa privately owned company, the company has used only the direct write-off method to account for uncollectible accounts. However, at the end of 2021, BHA wishes to obtain a loan at the local bank, which requires the preparation of proper financial statements. This means that BHA now will need to use the allowance method. The following transactions occur during 2021 and 2022. 1. During 2021, install air conditioning systems on account, $175,000. 2. During 2021, collect $170,000 from customers on account. 3. At the end of 2021, estimate that uncollectible accounts total 20% of ending accounts receivable. 4. In 2022, customers' accounts totaling $6,500 are written off as uncollectible. 3. Calculate bad debt expense for 2021 and 2022 under the allowance method and under the direct write-off method, prior to any adjusting entries. (Leave no cells blank.) Bad Debt Expense Allowance Method Direct Write-off Method 2021: 2022
