Che Exercise 9-5 Percent of sales method; write-off LO P3 At year-end (December
ID: 2556083 • Letter: C
Question
Che Exercise 9-5 Percent of sales method; write-off LO P3 At year-end (December 3, Chan Company estimates its bad debts as 070% of its annual credit sales of $896,000. Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $448 account of P Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare the journal entries for these transactions. View transaction list X: 1 Record the estimated bad debts expense. 2 Wrote off P. Park's account as uncollectible. 3 Reinstated Park's previously written off account. 4 Record the cash received on account. Credit Prex 2017 ??: Next>Explanation / Answer
Chan Company Date Account Title Debit Credit Dec.31, Year 1 Bad Debt Expense 6272 Allowance for Doubtful Accounts 6272 (Bad debts provided for @0.7% of sales) Date Account Title Debit Credit Feb.1, Year 2 Allowance for Doubtful Accounts 448 Accounts Receivable - P.Park 448 (Account of P.Park written off) Date Account Title Debit Credit June.5, Year 2 Accounts Receivable - P.Park 448 Allowance for Doubtful Accounts 448 (Reinstating account of P.Park) Date Account Title Debit Credit June.5, Year 2 Cash 448 Accounts Receivable - P.Park 448 (Cash received from P.Park)