Question

On January 1, Wei company begins the accounting period with a $30,000 credit balance in allowance for doubtful accounts. a. On February 1, the company determined that $6,800 in customer accounts was uncollectible; specifically, $900 for Oakley Co. and $5,900 for Brookes Co. Prepare the journal entry to write off those two accounts. b. On June 5, the company unexpectedly received a $900 payment on a customer account, Oakley Company, that had previously been written off in part a. Prepare the entries necessary to reinstate the account and to record the cash received.

Answer 1

Answer:

Journal Entries that are required are given below

Explanation:

On February 1(Write off)                 Debit     Credit

Allowance for doubtful debt            $6800

Account receivable (Oakley Co.)                   $900

Account receivable (Brookes Co.)                 $5900

On June 5 (Reinstating the account)     Debit       Credit

Account receivable (Oakley Co.)              $900

Allowance for doubtful debt                                       $900

On June 5 (Recording the cash received)     Debit    Credit

Cash                                                                    $900

Account Receivable(Oakley Co.)                                   $900