Question

CALCULATOR FULL SCREEN PRINTER VERSION BACH Open calculator Brief Exercise 8-4 At the end of 2019, Sheffield Corp. has accounts receivable of $739,200 and an allowance for doubtful accounts of $67,900. On January 24, 2020, the company learns that it receivable from Megan Gray is not collectible, and management authorizes a write-off of $6,500. Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Act Than Explanation Debit Credit SHOW LIST OF ACCOUNTS What is the cash realizable value of the accounts receivable (1) before the write-off and (2) after the write-off? Before Write-Off After Write Off Cash realizable value SHOW LIST OF ACCOUNTS S SAVE FOR LATER Question Attempts: 0 of 3 used ET ANSW Doch w as

Answer 1

Solution 1:

Account title	Debit	Credit
Allowance for Doubtful accounts	6500
Accounts receivable		6500

Solution 2:

Cash realizable value before write off = accounts receivable - allowance for doubtful accounts

= $739200 - $67900 = $671,300

Cash realizable value after write off = accounts receivable after write off - allowance for doubtful accounts after written off

= ($739200 -$6500) - ($67900- $6500) = $671,300