Assume that on March 15,a customer who owes Chisago sales company $3,000 is declared bankrupt by a federal court.The entry that would be made to write off this account is:

Question

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The entry to write off an uncollectible account is to debit the Allowance for uncollectible account and credit the Accounts receivable account. This is because the Allowance for uncollectible account is a contra-asset account that is used to offset the balance in the Accounts receivable account. Option B is incorrect as it assumes that the Chisago sales company has received cash from the bankrupt customer, which is not the case. Option C involves Notes receivable, which is not relevant in this scenario. Option D is incorrect as it involves a cash transaction, which is not applicable here.

Assume That on March 15,a Customer Who Owes Chisago Sales