On December 31, 2019, Skysong, Inc. estimated that 2% of its net accounts receivable of $431,400 will become uncollectible. The company recorded this amount as an addition to Allowance for Doubtful Accounts. The allowance account had a zero balance before adjustment on December 31, 2019. On May 11, 2020, Skysong, Inc. determined that the Jeff Shoemaker account was uncollectible and wrote off $2,157. On June 12, 2020, Shoemaker paid the amount previously written off. Prepare the journal entries on December 31, 2019, May 11, 2020, and June 12, 2020.

Question

Business

Corinne Good

24 October, 01:14

On December 31, 2019, Skysong, Inc. estimated that 2% of its net accounts receivable of $431,400 will become uncollectible. The company recorded this amount as an addition to Allowance for Doubtful Accounts. The allowance account had a zero balance before adjustment on December 31, 2019. On May 11, 2020, Skysong, Inc. determined that the Jeff Shoemaker account was uncollectible and wrote off $2,157. On June 12, 2020, Shoemaker paid the amount previously written off. Prepare the journal entries on December 31, 2019, May 11, 2020, and June 12, 2020.

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Reece Bridges · Answer 1

See explanation section.

Explanation:

December 31, 2019 Bad debt expense Debit $8,628

Allowance for Doubtful Accounts Credit $8,628

To record the estimated uncollectible from accounts receivable.

May 11, 2020 Allowance for Doubtful Accounts Debit $8,628

Accounts receivable Credit $8,628

To record the write off.

June 12, 2020 Accounts receivable Debit $8,628

Allowance for Doubtful Accounts Credit $8,628

To record the reinstatement.

June 12, 2020 Cash Debit $8,628

Accounts receivable Credit $8,628

To record the unexpected payment from previous write off.