27. Newton Company uses the allowance method of accounting for uncollectible acc

Question

27. Newton Company uses the allowance method of accounting for uncollectible accounts On May 3, the Newton Company wrote off the $3,000 uncollectible account of its customer, P. Best. On July 10, Newton received a check for the full amount of $3,000 from Best. On July 10, the entry or entries Newton makes to record the recovery of the bad debt IS: 3,000 A. Accounts Receivable - P. Best Allowance oubtful 3,000 Accounts 3,000 Cash Accounts Receivable- P. Best 3,000 B. Cash 3,000 Bad debts expense 3,000 C. Accounts Receivable - P. Best 3,000 Bad debts expense 3,000 Cash 3,000 Accounts Receivable P. Best 3,000 D. Allowance for Doubtful Accounts 3,000 Accounts Receivable - P. Best 3,000 Accounts Receivable- P. Best 3,000 Cash 3,000 E. Cash 3,000 Accounts Receivable -P. Best 3,000 8. The allowance method based on the idea that a given percent of a company's c

Explanation / Answer

Answer:

Option A is correct.

Accounts receivable-P. Best.....................3000
allowance for doubtful accounts.........................3000

Cash......................................................................3000
accounts receivable-P. Best.....................................3000

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