When an account receivable that has previously been written off is later paid, under the allowance method the correct accounting is to
A) Dr. A/R Cr. Allowance for Doubtful Accounts
Dr) Cash
Cr) A/R
B) Dr. Cash Cr. A/R
Dr) A/R
Cr) Allowance for Doubtful Accounts
C) Dr. Cash Cr. A/R
D) Dr. A/R Cr. Allowance for Doubtful Accounts

Question

Quizplus · Accepted Answer

When an account previously written off is collected, it is first reinstated by debiting Accounts Receivable and crediting Allowance for Doubtful Accounts, then the cash is recorded by debiting Cash and crediting Accounts Receivable.

When an Account Receivable That Has Previously Been Written Off