On December 31, Burrell, Inc.'s books showed accounts receivable of $385,600; sales revenue of $1,480,000 (70% were on credit); and Allowance for Doubtful Accounts of $1,600 (credit balance).
-Assume bad debts are estimated and recorded as 2% of credit sales.
(1) Show how Accounts Receivable and Allowance for Doubtful Accounts would appear on the balance sheet.
(2) Present the entry to write off a $1,800 account.
(3) Show how Accounts Receivable and Allowance for Doubtful Accounts would appear on a balance sheet immediately after writing off the account in (2) above.

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The Answer of On December 31, Burrell, Inc.'s books showed accounts receivable of $385,600; sales revenue of $1,480,000 (70% were on credit); and Allowance for Doubtful Accounts of $1,600 (credit balance).
-Assume bad debts are estimated and recorded as 2% of credit sales.
(1) Show how Accounts Receivable and Allowance for Doubtful Accounts would appear on the balance sheet.
(2) Present the entry to write off a $1,800 account.
(3) Show how Accounts Receivable and Allowance for Doubtful Accounts would appear on a balance sheet immediately after writing off the account in (2) above.