On January 1, Wei company begins the accounting period with a $49,000 credit balance in Allowance for Doubtful Accounts. On February 1, the company determined that $10,600 in customer accounts was uncollectible; specifically, $2,800 for Oakley Co. and $7,800 for Brookes Co. Prepare the journal entry to write off those two accounts. On June 5, the company unexpectedly received a $2,800 payment on a customer account, Oakley Company, that had previously been written off in part a. Prepare the entries to reinstate the account and record the cash received.

Question

Everett

Business

17 November, 10:49

On January 1, Wei company begins the accounting period with a $49,000 credit balance in Allowance for Doubtful Accounts. On February 1, the company determined that $10,600 in customer accounts was uncollectible; specifically, $2,800 for Oakley Co. and $7,800 for Brookes Co. Prepare the journal entry to write off those two accounts. On June 5, the company unexpectedly received a $2,800 payment on a customer account, Oakley Company, that had previously been written off in part a. Prepare the entries to reinstate the account and record the cash received.

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Reid · Answer 1

The Journal entries are as follows:

(i) On February 1,

Allowance for doubtful accounts A/c Dr. $10,600

To Account receivable-Oakley Co $2,800

To Account receivable-Brookes Co $7,800

(To record write off)

(ii) (a) On June 5,

Account receivable-Oakley CO A/c Dr. $2,800

To Allowance for doubtful accounts $2,800

(To record amount reinstated)

(b) On June 5,

Cash A/c Dr. $2,800

To Account receivable-Oakley CO $2,800

(To record cash received)