Jones Company writes off $500 of the Accounts Receivable owed by Joe Smith. Joe Smith did end up paying the $500, so Jones Company reversed the write off. Using the allowance method, what is the journal entry to show receiving the cash from Joe Smith after the write off on his account is reversed?

Question

Business

Paula Cooke

12 February, 08:02

Jones Company writes off $500 of the Accounts Receivable owed by Joe Smith. Joe Smith did end up paying the $500, so Jones Company reversed the write off. Using the allowance method, what is the journal entry to show receiving the cash from Joe Smith after the write off on his account is reversed?

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Kristina Fitzpatrick · Answer 1

Journal entry to record Smith's payment

Dr Cash account 500 Cr Accounts Receivable account 500

Explanation:

The following journal entry was made when the account was written off:

Dr Bad Debt Expense account 500 Cr Accounts Receivable account 500

When the write off was reversed the following journal entry was made:

Dr Accounts Receivable account 500 Cr Bad Debt Expense account 500