Question

At year-end (December 31), Chan Company estimates its bad debts as 0.80% of its annual credit sales of $831,000.

Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $416
account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount
previously written off.
Prepare Chan's journal entries for the transactions.

Answer 1

Answer:At year-end (December 31), Chan Company estimates its bad debts as 0.80% of its annual credit sales of $831,000. Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $416 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare the journal entries for these transactions. View transaction list 1 Record the estimated bad debts expense. 2 Wrote off P. Park's account as uncollectible. 3 Reinstated Park's previously written off account 4 Record the cash received on account. Credit Note :· journal entry has been entered Record entry Clear entry View general journal