Problem

Refer to the data in Exercise 15-6. Assume instead that Newton Company uses the direct...

Refer to the data in Exercise 15-6. Assume instead that Newton Company uses the direct write-off method of accounting for uncollectible accounts. On May 3, the Newton Company wrote off the $3,000 uncollectible account of its customer, P. Best. On July 10, Newton received a check for the full amount of $3,000 from P. Best. Prepare the (a) May 3 journal entry Newton makes to write off the debt and (b) the July 10 journal entry or entries Newton makes to record the recovery of the bad debt.

Reference Exercise 15-6:

Recoveries of previously written off accounts

Newton Company uses the allowance method of accounting for uncollectible accounts. On May 3, the Newton Company wrote off the $3,000 uncollectible account of its customer, P. Best. On July 10, Newton received a check for the full amount of $3,000 from P. Best. Prepare the (a) May 3 journal entry Newton makes to write off the debt and the (b) July 10 journal entry or entries Newton makes to record the recovery of the bad debt.

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Solutions For Problems in Chapter 15