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Prepare general journal entries to record the following transactions for the Harris Company. (The...

Question:

Prepare general journal entries to record the following transactions for the Harris Company. (The company uses the balance sheet approach for recording bad debts expense.):

2010:
Dec. 31: Recorded Bad Debts Expense, $800.
2011:
Jan. 3: Wrote off Jal's account as uncollectible, $60.
Mar. 4: Wrote off Hall's account as uncollectible, $75.
Jul. 5: Recovered $45 from Hall.
Aug. 19: Wrote off M. Wilson's account as uncollectible, $100.
Nov. 7: Recovered $25 from Jal.

Answer and Explanation:

Date Account Debit Credit Explanation
Dec. 31, 2010 Bad Debt Expense $800 Record bad debt expense
Allowance for Doubtful Accounts $800 Under the balance sheet method, bad debt is only adjusted alongside the allowance account.
Jan. 3, 2011 Allowance for Doubtful Accounts $60 Remove the allowance due to the write-off
Accounts Receivable $60 Remove Jan's accounts receivable balance
Mar. 4, 2011 Allowance for Doubtful Accounts $75 Remove the allowance due to the write-off
Accounts Receivable $75 Remove Hall's accounts receivable balance
Jul. 5, 2011 Accounts Receivable $45 Restore previously written off receivable
Allowance for Doubtful Accounts $45 Restore previously written off allowance
Cash $45 Record cash received from Hall
Accounts Receivable $45 Remove Hall's accounts receivable upon receipt of payment
Aug. 19, 2011 Allowance for Doubtful Accounts $100 Remove the allowance due to the write-off
Accounts Receivable $100 Remove Wilson's accounts receivable balance
Nov. 7, 2011 Accounts Receivable $25 Restore previously written off receivable
Allowance for Doubtful Accounts $25 Restore previously written off allowance
Cash $25 Record cash received from Jal
Accounts Receivable $25 Remove Jal's accounts receivable upon receipt of payment

Learn more about this topic:

Uncollectable Accounts, the Allowance Method & Bad Debt

from Accounting 101: Financial Accounting

Chapter 7 / Lesson 3
7.9K

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