For each of the following scenarios, indicate the amount of the adjusting journa

Question

For each of the following scenarios, indicate the amount of the adjusting journal entry for Bad Debt expense to be recorded, the balance in Allowance for Doubtful Accounts after adjustment at December 31, and the net realizable value of Accounts Receivable at December 31.

c. Hidgon Inc. has a balance of $812,000 in Accounts Receivable at December 31. An analysis of those receivables shows $24,000 will probably not be collected. Before adjusting entries are prepared, the Allowance for Doubtful Accounts has a debit balance of $750.

Bad Debt Expense $

Allowance for Doubtful Accounts at Dec. 31

Net Realizable Value of A/R at Dec. 31

Explanation / Answer

Bad Debt Expense = 24000+750 = 24750 Allowance for Doubtful Accounts at Dec. 31 = 24000 Net Realizable Value of A/R at Dec. 31 = 812000-24000 = 788000

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