Molina Company had a $700 credit balance in Allowance for Doubtful Accounts at December 31, 2018, before the current year's provision for uncollectible accounts. An aging of the accounts receivable revealed the following:
Instructions
(a) Prepare the adjusting entry on December 31, 2018, to recognize bad debt expense.
(b) Assume the same facts as above except that the Allowance for Doubtful Accounts account had a $500 debit balance before the current year's provision for uncollectible accounts. Prepare the adjusting entry for the current year's provision for uncollectible accounts.

Question

Quizplus · Accepted Answer

The Answer of Molina Company had a $700 credit balance in Allowance for Doubtful Accounts at December 31, 2018, before the current year's provision for uncollectible accounts. An aging of the accounts receivable revealed the following:
Instructions
(a) Prepare the adjusting entry on December 31, 2018, to recognize bad debt expense.
(b) Assume the same facts as above except that the Allowance for Doubtful Accounts account had a $500 debit balance before the current year's provision for uncollectible accounts. Prepare the adjusting entry for the current year's provision for uncollectible accounts.

Molina Company Had a $700 Credit Balance in Allowance for Doubtful