Question

On December 31, 2013, when its Allowance for Doubtful accounts had a debit balance of $1,400, Hunt co. estimates that 9% of its accounts receivable balance of $90000 will become uncollectible and records the necessary adjustment to Allowance for Doubtful Accounts. On may 11, 2014, Hunt Co. determined that J. Byrd's account was uncollectible and wrote of $1,200. On June 12, 2014, Byrd paid the amount previously written off.

Prepare the journal entries on December 31, 2013, May 11, 2014, and June 12, 2014

Answer 1

Event	Particulars	Debit	Credit
31-Dec	Bad debt expesne (90000*9%+1400)	$9,500.00
	To Allowance for doubtful accounts		$9,500.00
11-May	Allowance for doubtful accounts Dr	$1,200.00
	To Accounts receivables		$1,200.00
	(To written of accounts receivables)
12-Jun	Accounts receivables Dr	$1,200.00
	To Allowance for doubtful accounts		$1,200.00
	(To reinstate account previously written off)
	Cash Dr	$1,200.00
	To Accounts receivables		$1,200.00
	(To record collection of accounts previously written off)