Answer:
The Journal entries are as follows:
(a) (i) Accounts receivable A/c Dr. $782,000
To sales revenue $782,000
(To record sales)
(ii) Cash A/c Dr. $697,920
To Accounts receivable $697,920
(To record receipt)
(b) Allowance for doubtful accounts Dr. $6,591
To Accounts receivable $6,591
(To record the write-off of uncollectible accounts)
(c) (i) Accounts receivable A/c Dr. $2,948
To Allowance for doubtful accounts $2,948
(To reinstate account previously written off)
(ii) Cash A/c Dr. $2,948
To Accounts receivable $2,948
(To record receipt)
(c) Bad debt expense [$23,400 - $6,197] A/c Dr. $17,203
To Allowance for doubtful accounts $17,203
(To record bad debt expense for the period)
Ending balance in accounts receivables:
= Opening balance + sales on account during the period - Collection during the period - write off during the period
= $191,500 + $782,000 - $697,920 - $6,591
= $268,989
Allowance for doubtful accounts unadjusted balance:
= $9,840 + $2,948 - $6,591
= $6,197
Ending balance in Allowance for Doubtful Accounts = $23,400
