Homework Answers
Calculation for adjustment to allowance for doubtful debts
Allowance as on 31 Dec 2018 = $15,500.00
Bad debt written off (excluding the collected bad debt of $1700 ) = $9,800.00
Available Allowance after bad debt write off = $15,500.00 - $9,800.00 = $5,700.00
Total allowance for doubtful debts required for 31 Dec 2019 = $22,800.00
Adjustment required to allowance for doubtful debts for expected bad debts= $22,800 - $5,700.00 = $17,100.00
| Account Title & Explanation | Debit $ | Credit $ |
| Allowance for doubtful debts | 11,500 | |
| Accounts receivable (respective customer account) | 11,500 | |
| To record Bad debts amount write off | ||
| Accounts receivable | 1,700 | |
| Allowance for doubtful debts | 1,700 | |
| To reverse Bad Debts Write off | ||
| Cash / Bank | 1,700 | |
| Accounts receivable | 1,700 | |
| To record collection of write-off | ||
| Bad Debts expense ( estimated additional doubtful debts) | 17,100 | |
| Allowance for doubtful debts | 17,100 | |
| To record the estimated bad debts for the year |
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need help with this please?
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