Accounting Corp began operations on January 1, 2016. At the end of 2016, the company recorded bad debt expense of $1,500. On July 1, 2017, Accounting Corp wrote off as uncollectible $800 of accounts receivable. On August 31, 2017, the company reversed $200 of the write-offs made on July 1st. On December 31, 2017, the company estimated that 3% of its total accounts receivable would be uncollectible. Accounts receivable were $150,000 on December 31, 2017. The journal entry on July 1, 2017 includes a debit to __________ for __________ and a credit to __________ for __________.
Allowance for Doubtful Accounts:
The allowance for doubtful accounts represents the total amount of accounts receivable that the entity expects to be uncollectible in a reporting period and it is the contra asset account of the accounts receivable.
Answer and Explanation:
On July 1, 2017, Accounting Corp wrote off as uncollectible $800 of accounts receivable.
|Allowance for Doubtful Accounts||$800|
The account Allowance for doubtful accounts is debited when there are write-offs.
Become a member and unlock all Study Answers
Try it risk-free for 30 daysTry it risk-free
Ask a question
Our experts can answer your tough homework and study questions.Ask a question Ask a question
Learn more about this topic:
from Financial Accounting: Homework Help ResourceChapter 3 / Lesson 20