Answer:
a. journal entry to write off those two accounts
Bad Debts $10,400 (debit)
Oakley Co $2,700 (credit)
Brookes Co $7,700 (credit)
<em>Being write off of Oakley Co and Brookes Co</em>
b. entries to reinstate the account and record the cash received
Oakley Co $2,700 (debit)
Bad Debts $2,700 (credit)
<em>Being reinstatement of Oakley Co account</em>
Cash $2,700 (debit)
Oakley Co $2,700 (credit)
<em>Being record of the cash received</em>
Explanation:
a. journal entry to write off those two accounts
Recognize a Bad Debts expense and de-recognize the assets - Trade Receivables
b. entries to reinstate the account and record the cash received
Recognize the assets-Account Receivable and de-recognize the Bad Debt expense
Also, Recognize the Assets of Cash and De-recognize the Trade Receivables as a results of receipt of payment.
