Question

On January 1, 2019, the balance in Tabor Co.'s Allowance for Bad Debts account was $13,966. During the first 11 months of the year, bad debts expense of $21,297 was recognized. The balance in the Allowance for Bad Debts account at November 30, 2019, was $9,797.

Answer 1

(a) What was the total of accounts written off during the first 11 months?

(b) As the result of a comprehensive analysis, it is determined that the December 31, 2010, balance of the Allowance for Bad Debts account should be $9,450. Show the adjustment required in the journal entry format.

a. Bad debt written off = Opening Balance in bad debt allowance account + Bad debt expense recognized during the period - Closing balance in bad debt allowance account

Bad debt written off = $13,966 + $21,297 - $9,797

Bad debt written off = $25,466

Therefore, the total of accounts written off during the first 11 months is $25,466

b. Date Description and Explanation Debit Credit

31-Dec Allowance for bad debts $347

($9,797 - $9,450)

Bad debt expenses $347

($9,797 - $9,450)

(To record adjustment of allowance of bad debt account)