Question

Exercise 7-9 Writing off receivables LO P2 Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis 5 points Days Past Due Skipped Over 90 $30,000 10 Total $570,000 1 to 30 $90,000 2 0 31 to 60 61 to 90 $18,000 Accounts receivable Percent uncollectible $36,000 $396,000 7 eBook a. On February 1 of the next period, the company determined that $6,800 in customer accounts was uncollectible; specifically, $900 for Oakley Co. and $5,900 for Brookes Co. Prepare the journal entry to write off those two accounts. b. On June 5 of that next period, the company unexpectedly received a $900 payment on a customer account, Oakley Company, that had previously been written off in part a. Prepare the entries necessary to reinstate the account and to record the cash received. Print References View transaction list Journal entry worksheet 1 2 3 The company determined that $6,800 in customer accounts is uncollectible; specifically, $900 for Oakley Co. and $5,900 for Brookes Co. Prepare the journal entry to write off those accounts. Note: Enter debits before credits General Journal Date Credit Debit Next 7 of 13 Mc Graw Hill Prev

Answer 1

Solution:

Journal Entries - Daley Company
Date	Particulars	Debit	Credit
1-Feb	Allowance for doubtful accounts Dr	$6,800.00
	To Accounts receivables - Oakley Co.		$6,800.00
	To Accounts receivables - Brookes Co.
	(To write off receivables)
5-Jun	Accounts receivables - Oakley Co Dr	$900.00
	To Allowance for doubtful accounts		$900.00
	(To reinstate receivables)
5-Jun	Cash Dr	$900.00
	To Accounts receivables - Oakley Co.		$900.00
	(To record collection from customer)