Question

Exercise 201 a-b (Part Level Submission) The income statement approach to estimating uncollectible accounts expense is used by Kerley Company. On February 28, the firm had accounts receivable in the amount of $437,000 and Allowance for Doubtful Accounts had a credit balance of $2,140 before adjustment. Net credit sales for February amounted to $3,000,000. The credit manager estimated that uncollectible accounts expense would amount to 1% of net credit sales made during February. On March 10, an accounts receivable from Kathy Black for $6,100 was determined to be uncollectible and written off. However, on March 31, Black received an inheritance and immediately paid her past due account in full. Your answer is correct. Prepare the journal entries made by Hayes Company on the below dates: (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) 1. February 28 2. March 10 3. March 31 Date Account Titles and Explanation Credit Debit 30000 | Feb. 28 Bad Debt Expense Allowance for Doubtful Accounts 30000 Mar. 10 Allowance for Doubtful Accounts 200X Accounts Receivable 6100 Mar. 31 Accounts Receivable Allowance for Doubtful Accounts T 6100 (To reinstate an account previously written off) Mar. 31 Cash | Accounts Receivable T 6100 (To record collection of payment) Click if you would like to Show Work for this question: Open Show Work SHOW LIST OF ACCOUNTS SHOW SOLUTION SHOW ANSWER LINK TO TEXT Attempts: 1 of 2 used (b) Assume no other transactions occurred that affected the allowance account during March. Determine the balance of Allowance for Doubtful Accounts at March 31. Balance of Allowance for Doubtful Accounts at March 31

Answer 1

Allowance for Doubtful Accounts beginning balance	2140
Add: Bad Debts expense	30000
Add: Account reinstated	6100
Less: Account Written off	-6100
Balance of Allowance for Doubtful Accounts at March 31	32140