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    Shirleyan's Avatar
    Shirleyan Posts: 13, Reputation: 1
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    #1

    Apr 7, 2007, 11:07 PM
    Record of Allowance for Doubtful Accounts entry
    If a firm discovers that one of its accounts totaling $350 should be written off as uncollectible, if using an aging of receivables, the firm determines that the ending balance of the Allowance for Doubtful Accounts should be ($1,000).

    I'm also given that these is already $828 in Allowance for Doubtful Accounts and $4000 in Accounts Receivables in the beginning balance.

    How can I record this entry?

    Thank you very much for your help!
    goldenbutterfly's Avatar
    goldenbutterfly Posts: 63, Reputation: 8
    Junior Member
    		  
    #2

    Apr 8, 2007, 08:47 PM
    Entry should be:
    Dr Bad Debts Expense 522
    Cr Allowance for Doubtful Accounts 522
    Shirleyan's Avatar
    Shirleyan Posts: 13, Reputation: 1
    New Member
    		  
    #3

    Apr 9, 2007, 12:22 AM
    Quote Originally Posted by goldenbutterfly
    Entry should be:
    dr Bad Debts Expense 522
    cr Allowance for Doubtful Accounts 522

    Thank you very much! But how did you get the 522 amount?

    Thanks again!
    goldenbutterfly's Avatar
    goldenbutterfly Posts: 63, Reputation: 8
    Junior Member
    		  
    #4

    Apr 9, 2007, 06:46 PM
    It would be best to visualize the computation using the T-account:

    Allowance for Doubtful Accounts, beg 828
    Less: Write-off of AR (350)
    Less: Required ending balance of ADA (1000)

    Required Adjustment to ADA 522
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