Question

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On June 1. 2018. Peak Performance Cell Phones sold $24,000 of merchandise to Ackerman Trucking Company on account. Ackerman fell on hard times and on July 15 paid only $8,500 of the account receivable. After repeated attempts to collect, Peak Performance finally wrote off its accounts receivable from Ackerman on September 5. Six months later, March 5, 2019, Peak Performance received Ackerman's check for $15,500 with a note apologizing for the late payment. Read the requirements Requirement 1. Journalize the transactions for Peak Performance Cell Phones using the direct write-off method. Ignore Cost of Goods Sold (Record debits first, then credits. Select the explanation on the last line of the journal entry table ) June 1 Peak Performance Cell Phones sold $24,000 of merchandise to Ackerman Trucking Company on account. Ignore Cost of Goods Sold. Date Accounts and Explanation Debit Credit Jun 1 July 15: Ackerman paid $8,500 of the account receivable. Date Accounts and Explanation Jul 15 Debit Credit September 5: Peak Performance wrote off its accounts receivable from Ackerman Accounts and Explanation Credit Date Sep 5

Answer 1

date	accounts	debit	credit
june 1	Accounts receivable - Ackerman trucking co a/c	24,000
	..........To sales revenue a/c		24,000
jul 15	cash a/c	8,500
	........To accounts receivable - ackerman trucking co a/c		8,500
sep 5	bad debt expense	15,500
	............To accounts receivable - ackerman trucking co a/c		15,500
	(amount - 24,000-8,500=>15,500)
mar 5	accounts receivable - ackerman trucking co a/c	15,500
	............To bad debt expense a/c		15,500
mar 5	cash a/c	15,500
	.........To accounts receivable - ackerman trucking co a/c		15,500

requirement 2.

option A is correct.

direct write off method violates the matching principle.