Ask Question
11 June, 11:28

Gomez Corp. uses the allowance method to account for uncollectibles. On January 31, it wrote off an $800 account of a customer, C. Green. On March 9, it receives a $300 payment from Green. Prepare the journal entry or entries for January 31. Prepare the journal entry or entries for March 9; assume no additional money is expected from Green.

+2
Answers (1)
  1. 11 June, 14:13
    0
    Gomez Corp. Journal entry

    1. 31-Jan

    Dr Allowance for doubtful accounts $800

    Cr Accounts receivable - C. Green $800

    2. 9-Mar

    Dr Accounts receivable - C. Green $300

    Cr Allowance for doubtful accounts $300

    3. 9-Mar

    Dr Cash $300

    Cr Accounts receivable - C. Green $300

    Explanation:

    1. On January 1 Gomez Corp was said to use the allowance method to account for uncollectibles which means we have to record the write off as uncollectibles by Debiting Allowance for doubtful accounts with $800 and Credit Accounts receivable - C. Green with the same amount.

    2. On March 9, receives a payment of $300 from Green which means we have to record the accounts receivables reinstated by

    Debiting Accounts receivable - C. Green with $300 and Crediting Allowance for doubtful accounts with same amount.

    3. Since it receives a payment of $300 from Green on March 9 we have to record cash receipt by Debiting Cash with $300 and Crediting Accounts receivable - C. Green with $300.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Gomez Corp. uses the allowance method to account for uncollectibles. On January 31, it wrote off an $800 account of a customer, C. Green. ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers