Question - At the end of 2019, Carpenter Co. has accounts receivable of $700,000 and an allowance for doubtful accounts of $54,000. On January 24, 2020, the company learns that its receivable from Megan Gray is not collectible, and management authorizes a write-off of $6,200.
(a) Prepare the journal entry to record the write-off.
(b) What is the cash realizable value of the accounts receivable (1) before the write-off and (2) after the write-off?
Prepare entries for collection of bad debt write-off.