Question

CALCULATOR PRINTER VERSION BACK Brief Exercise 8-3 At the end of 2016, Crane Company has accounts receivable of $713,800 and an allowance for doubtful accounts of $23,690. On January 24, 2017, it is learned that the company's receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $3,885. (a) Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Allowance for Doubtful Accounts Accounts Receivable (b) What is the cash realizable value of the accounts receivable before the write-off and after the write-off? Before Write-off After Write-Off Cash realizable value 10:35 PM Search CCCLLC

Answer 1

(a)

Account Titles and Explanation	Debit	Credit
Allowance for doubtful debts	$3,885
Accounts receivable		$3,885

(b)

	Before Write-Off	After Write-Off
Cash realizable value	$690,110 ($713,800-$23,690)	$690,110 [($713,800-$3,885)-($23,690-$3,885)]