Question

Sep 21 $3 Bad debts, write-off, recovery L02 ord the following selected transactions for Allistar Company during its first two months of operations ar. 4 Performed services for various customers on account: $165,000. 15 Collected $80,000 from credit customers. 20 Determined that Tom Williams, a credit customer, would not be paying his $5,000 account: wrote it off. 25 Tom Williams came into an inheritance and paid Allistar the amount written off on March 20. 2 Performed services for various customers on account: $280,000 9 Collected $110.000 from credit customers. 30 Allistar estimated had debt expense to be $8,000. pr. 4 Balance sheet presentation Lo2 m the following alphabetized list of adjusted account balances, prepare the current asset section of Biotech's December 31, 2020, balance sheet. Account Accounts receivable [email protected]'s screen lowance for doubtful accounts. Debit Credit 29.000 1.300 ******

Answer 1

It has been assumed that the company does not have provision for doubtful accounts in the month of march that is why the written off entry is done with debiting bad debts accounts. Otherwise the entry would have been Allowance for doubtful accouts(dr.) & accounts receivable (cr.)
JOURNAL ENIRISS Date Particulars Debit Mar.t. Accounts Receivable alc Dr. 1,651000 To Service Rereniu al Oredit 1,65,000 80,000 Sooo Marli Bank ale Dr. 80,000 To Accounts Receivable alc Marco Bad debts ale SOUD To Accounts Receivable (Bad clebts written alu 732 Mares Accounts Receivable ale DY SVOO To Bad debts al CBeing the bad debes witten off entry reversed) Mar 25 Bank alu 5000 To Accounts Receivable C Being the receired) al Accounts Receivable Dr. | 280,000 To Service Reventuale 500o sooo amount Apr 2 2,80,000 Aprg Bank alu Dr. 110, wo To Accounts Recivable 110,000 alc

800 Apr 34 Bad Debts alc Br. 8000 To Allowance for Doubtful Accountsal (Being the estimate of Bad debts