Accounts receivable transactions are provided below for J Pharoah Co. Dec. 31, 2020 The company estimated...

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Accounts receivable transactions are provided below for J Pharoah Co. Dec. 31, 2020 The company estimated...

Accounts receivable transactions are provided below for J Pharoah Co.

Dec. 31, 2020		The company estimated that 4% of its accounts receivable would become uncollectible. The balances in the Accounts Receivable account and Allowance for Doubtful Accounts were $661,000 and $2,700 (debit), respectively.
Mar. 5, 2021		The company determined that R. Mirza’s $3,500 account and D. Wight’s $6,900 account were uncollectible. The company’s accounts receivable were $691,400 before the accounts were written off.
June 6, 2021		Wight paid the amount that had been written off on March 5. The company’s accounts receivable were $650,600 prior to recording the cash receipt for Wight.

Prepare the journal entries on December 31, 2020, March 5, 2021, and June 6, 2021.

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Answer 1

Answer #1

Journal entry

Date	account and explanation	Debit	Credit
Dec 31	Bad debt expense (661000*4%+2700)	29140
	Allowance for doubtful accounts		29140

Mar 5	Allowance for doubtful accounts (3500+6900)	10400
	Account receivable-R.Mirza		3500
	Account receivable-D.Wight		6900

June 6	Account receivable-D.Wight	6900
	Allowance for doubtful accounts		6900

	Cash	6900
	Account receivable-D.Wight		6900

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Answer 2

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