On December 31, 2021, when its Allowance for Doubtful Accounts had a debit balance of $1,200, Novak Corp. estimates that 9% of its accounts receivable balance of $80,000 will become uncollectible and records the necessary adjustment to Allowance for Doubtful Accounts. On May 11, 2022, Novak Corp. determined that B. Jared's account was uncollectible and wrote off $1,300. On June 12. 2022, Jared paid the amount previously written off. Prepare the journal entries on December 31, 2021, May 11, 2022, and June 12, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter O for the amounts) Account Titles and Explanation Date Debit Credit
On December 31, 2021, when its Allowance for Doubtful Accounts had a debit balance of $1,200, Novak Corp. estimates that 9% of its accounts receivable balance of $80,000 will become uncollectible and records the necessary adjustment to Allowance for Doubtful Accounts. On May 11, 2022, Novak Corp. determined that B. Jared's account was uncollectible and wrote off $1,300. On June 12. 2022, Jared paid the amount previously written off. Prepare the journal entries on December 31, 2021, May 11, 2022, and June 12, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter O for the amounts) Account Titles and Explanation Date Debit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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On December 31, 2021, when its Allowance for Doubtful Accounts had a debit balance of $1.200, Novak Corp, estimates that 9% of its
accounts receivable balance of $80,000 will become uncollectible and records the necessary adjustment to Allowance for Doubtful
Accounts. On May 11, 2022, Novak Corp, determined that B. Jared's account was uncollectible and wrote off $1,300. On June 12.
2022, Jared paid the amount previously written off.
Prepare the journal entries on December 31, 2021, May 11, 2022, and June 12, 2022. (Credit account titles are automatically indented
when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter 0 for the amounts)
Date
Account Titles and Explanation
Debit
Credit
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