The Dumbledore Group disclosed the following analysis of its account receivable as at December 31, 2019....

The Dumbledore Group disclosed the following analysis of its account receivable as at December 31, 2019.

Aged Account Receivable	Amount	% Probably Uncollectible
Not past due	$11,801	1%
Past due 1-30 days	851	5%
Past due 31-60 days	254	10%
Past due 61-90 days	108	20%
Past due 91-120 days	60	30%
More than 120 days	737	40%
Total amount	$13,811

At January 1, 2019, the allowance for doubtful accounts had a balance of $377. If adjusting entries relating to receivables and doubtful accounts are necessary, which journal entry should be recorded (round to the nearest dollar)?

Debit bad debt expense $520 and credit allowance for doubtful accounts $520
Debit bad debt expense $257 and credit allowance for doubtful accounts $257.
Debit bad debt expense $143 and credit allowance for doubtful accounts $143.
Debit bad debt expense $257, credit allowance for doubtful accounts $242 and credit accounts receivable $15.
No adjusting entries are required

Now, assume a total of $99 was written off as uncollectible during 2019. What was the journal entry?

Debit Allowance for doubtful accounts $84 and credit accounts receivable $84.
Debit Allowance for doubtful accounts $99 and credit accounts receivable $99.
Debit Allowance for doubtful accounts $129 and credit accounts receivable $99.
Debit Allowance for doubtful accounts $99 and credit accounts receivable $69.
No accounts receivables were written off

Assuming Dumbledore recovered $15 from customers whose accounts were written off in 2018, what was the journal entry?

Debit allowance for doubtful accounts $15, credit accounts receivable $15, debit cash $15 and credit allowance for doubtful accounts $15.
Debit accounts receivable $84, credit allowance for doubtful accounts $84, debit cash $84 and credit accounts receivable $84.
Debit accounts receivable $114, credit allowance for doubtful accounts $114, debit cash $114 and credit accounts receivable $114.
Debit accounts receivable $15, credit allowance for doubtful accounts $15, debit cash $15 and credit accounts receivable $15.
No accounts receivables were recovered.

Expert Solution

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.

ekkarill92 answered 2 years ago

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