Daley Company estimates uncollectible accounts using the allowance method at Dec

Question

Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis.

a. On February 1 of the next period, 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 of that next period, 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.

Days Past Due Total 0 1 to 30 31 to 60 61 to 90 Over 90 Accounts receivable $ 570,000 $ 396,000 $ 90,000 $ 36,000 $ 18,000 $ 30,000 Percent uncollectible 1 % 2 % 5 % 7 % 10 % LO Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis. Days Past Due 1.25 points Accounts receivable Percent uncollectible Total $570,000 $396,000 1 to 30 $90,000 28 31 to 60 $36,000 61 to 90 $18,000 78 Over 90 $30,000 108 58 eBook a. On February 1 of the next period, 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 of that next period, 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. Ask View transaction list Print Journal entry worksheet References 2 3 The company determined that $6,800 in customer accounts is uncollectible; specifically, $900 for Oakley Co. and $5,900 for Brookes Co. Prepare the journal entry to write off those accounts. Note: Enter debits before credits. Date General Journal Debit Credit Feb 01 Record entry Clear entry View general journal

Explanation / Answer

01-Feb Allowance for Doubtful Accounts          6,800 Accounts Receivable -Oakley Co.             900 Accounts Receivable -Brookes Co.          5,900 05-Jun Accounts Receivable -Oakley Co.             900 Allowance for Doubtful Accounts             900 05-Jun Cash             900 Accounts Receivable -Oakley Co.             900

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