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25 December, 03:41

On January 1, Wei company begins the accounting period with a $45,000 credit balance in allowance for doubtful accounts. a. On February 1, the company determined that $9,800 in customer accounts was uncollectible; specifically, $2,400 for Oakley Co. and $7,400 for Brookes Co. Prepare the journal entry to write off those two accounts. b. On June 5, the company unexpectedly received a $2,400 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.

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Answers (2)
  1. 25 December, 07:00
    0
    The Journal entry and their narrations is shown below:-

    Explanation:

    1. Allowance for doubtful accounts Dr, $9,800

    To Account receivable-Oakley Co. $2,400

    To Account receivable-Brookes Co. $7,400

    (Being write off is recorded)

    2. Account receivable-Oakley Co. Dr, $2,400

    To Allowance for doubtful accounts $2,400

    (Being amount reinstated is recorded)

    3. Cash Dr, $2,400

    To Account receivable-Oakley Co. $2,400

    (Being cash received is recorded)
  2. 25 December, 07:10
    0
    The journal entries are shown below

    Explanation:

    a. Allowance for doubtful accounts $9,800

    To Account receivable - Oakley Co $2,400

    To Account receivable - Brookes Co $7,400

    (Being the written off amount is recorded)

    b. Account receivable - Oakley Co $2,400

    To Allowance for doubtful accounts $2,400

    (Being the reinstated amount is recorded)

    c. Cash $2,400

    To Account receivable - Oakley Co $2,400

    (Being the cash receipt is recorded)
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