Question

Check 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 $25,800 in accounts receivable. Because BHASE 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 occu during 2021 and 2022. 1. During 2021, install air conditioning systems on account, $188,000. 2. During 2021, collect $183,000 from customers on account. 3. At the end of 2021, estimate that uncollectible accounts total 10% of ending accounts receivable. 4. In 2022, customers' accounts totaling $7,800 are written off as uncollectible. 2. Record each transaction using the direct write-off method. (If no entry is required for a particular transaction/event. select Journal Entry Required" in the first account field.)

Answer 1

	General Journal	Debit	Credit
1	Accounts receivable	188000
	Service revenue		188000
2	Cash	183000
	Accounts receivable		183000
3	No journal entry required
4	Bad debt expense	7800
	Accounts receivable		7800