Question

-Your answer is partially correct At the end of 2016, Marigold Corp. has accounts receivable of $718,400 and an allowance for doubtful accounts of $ 22,800. On January 24,2017, it is learned that the company's receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $ 4,359 (a) Prepare the journal entry to record the write-off. (Credit account titles are automatically indented when amount is entered. Do not indent manually Account Titles and Explanation Debit Credit Allowance for Doubtful Accounts 4,359 Accounts Receivable 4,359 (b) What is the cash realizable value of the accounts receivable before the write-off and after the write-off? Before Write-Off After Write-Off Cash realizable value 691.241 $ 691,241 List of Accounts eTextbook and Media

Answer 1

(a)

Account titles and explanation	Debit	Credit
Allowance for Doubtful Accounts	$4,359
Accounts receivables		$4,359

(b)

	Before Write-Off	After Write-Off
Accounts receivables (A)	$718,400	$714,041 [ $718,400 - $4,359 ]
Allowance for doubtful accounts (B)	$22,800	$18,441 [ $22,800 - $4,359 ]
Cash realizable value (A-B)	$695,600	$695,600