What is the normal journal entry for recording bad debt expense under the allowance method?a. Debit Accounts Receivable, credit Allowance for Doubtful Accounts.1.b. Debit Allowance for Doubtful Accounts, credit Bad Debt Expense.Debit Bad Debt Expense, credit Allowance for Doubtful Accounts.C.d. Debit Allowance for Doubtful Accounts, credit Accounts Receivable.Explain the answer you selected:2.Under the allowance method of recognizing uncollectible accounts, the entry to write off an uncollectibleaccountа.has no effect on net incomeb. decreases net incomec. increases the allowance for uncollectible accountsd. has no effect on the allowance for uncollectible accountsExplain the answer you selected:

Accounts receivable is an asset and it normally has a debit balance. Accounts receivable account is…

Answered: What is the normal journal entry for…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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What is the normal journal entry for recording bad debt expense? Group of answer choices debit Accounts Receivable, credit Bad Debt Expense debit Bad Debt Expense, credit Allowance for Uncollectible Accounts debit Allowance for Uncollectible Accounts, credit Bad Debt Expense debit Bad Debt Expense, credit Accounts Receivable
When an account is determined to be uncollectible, "writing off" the bad debt usually involves what????????
Under the allowance method, when $600 is authorised to be written off, the journal entry would be Select one: a. Debit Accounts Receivable $600, Credit Allowance for Doubtful Debts $200 b. Debit Bad Debts Expense $600, Credit Accounts Receivable $600 c. Debit Bad Debts Expense $600, Credit Allowance for Doubtful Debts $600 d. Debit Allowance for Doubtful Debts $600, Credit Accounts Receivable $600
When a large account receivable balance is due from one client it is logical to use the direct write-off method to adjust the bad debt expense and accounts receivable balance. Under different circumstances, another method is used called the allowance method. Discuss the best reason(s) for using the allowance method and give some examples of companies that are likely to use that method. Also explain why it would ever be appropriate to use the direct write-off method, especially since it is not GAA
Under the direct write-off method of accounting for uncollectible accounts, Bad Debt Expense is recorded Oa. when a credit sale is past due O b. whenever a predetermined amount of credit sales has been made Oc. when an account is determined to be worthless O d. at the end of each accounting period
The Allowance for Doubtful Accounts account will have a credit balance at the end of the period if the write-offs during the period are: none of the answers are correct. more than the beginning balance. less than the beginning balance. O equal to the beginning balance.
Assume the following information for Larkspur Corp. Accounts receivable (beginning balance) $139,000 Allowance for doubtful accounts (beginning balance) 11,480 Net credit sales 950,000 Collections 915,000 Write-offs of accounts receivable 5,500 Collections of accounts previously written off 2,200 Uncollectible accounts are expected to be 6% of the ending balance in accounts receivable.
When referring to a note receivable or promissory note a.the note cannot be factored to another party b.the note may be used to settle an account receivable c.the note is not considered a formal credit instrument d.the maker is the party to whom the money is due
An objective of the expense recognition principle ("matching") is to have bad debt expense recorded in: Multiple Choice O the same period that the related accounts receivable is determined to be uncollectible. the same period the related credit sales are recorded. a later period after the related credit sales are recorded. the period that a customer eventually becomes bankrupt.
The method of accounting for bad debts records the loss from an uncollectible account receivable when it is determined to be uncollectible. No attempt is made to predict bad debts expense. percentage of sales percentage of receivables direct write-off allowance
Flora Co. uses the allowance method of accounting for uncollectible accounts receivable. The entry to write off an account that has been determined to be uncollectible would be to debit a. Allowance for Doubtful Accounts and credit Accounts Receivable. Ob. Sales Returns and Allowances and credit Accounts Receivable. c. Accounts Receivable and credit Bad Debt Expense. Od. Bad Debt Expense and credit Allowance for Doubtful Accounts.
Bidiyah Co. estimates that RO 6,500 of its accounts receivable to be uncollectible. If Allowance for Doubtful Accounts has a RO 1,200 debit balance, the company should record a: Select one: O a. None of the answers are correct O b. debit to Bad Debt Expense for RO 5,300. O c credit to Allowance for Doubtful Accounts for RO 6,500. Od. debit to Allowance for Doubtful Accounts for RO 5,300. O e. credit to Bad Debt Expense for RO 7,700.

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