Question

Journalize the following transactions in the accounts of Canyon River Medical Co., a medical equipment company that uses the direct write-off method of accounting for uncollectible receivables:

Jan. 19	Sold merchandise on account to Dr. Kyle Norby, $45,000. The cost of goods sold was $24,300.
June 2	Received $11,300 from Dr. Kyle Norby and wrote off the remainder owed on the sale of January 19 as uncollectible.
Oct. 23	Reinstated the account of Dr. Kyle Norby that had been written off on June 2 and received $33,700 cash in full payment.

If an amount box does not require an entry, leave it blank.

Jan. 19-sale
Jan. 19-cost
June 2
Oct. 23-reinstate
Oct. 23-collection

Answer 1

Journal entries
S.no.	Accounts title and explanations		Debit$	Credit $
19-Jan	Accounts receivable			45000
	Sales revenue				45000
	(for sales made on account)
19-Jan	Cost of goods sold			24300
	Merchandise inventory			24300
	(for cost of goods sold)
02-Jun	Bad debts expense	(45000-11300)	33700
	Cash				11,300
	Accounts recievable			45,000
	(for amount written off)
23-Oct	Accounts receivable			33700
	Bad debts expense			33700
	(for amount reinstated)
23-Oct	Cash				33700
	Accounts recievable			33700
	(for amount received)