The collection of an account that had been previously written off under the allowance method of accounting for uncollectibles

Question

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When an account previously written off is collected under the allowance method, it requires reinstating the account and then recording the cash collection. This process reverses the write-off and records the cash receipt without affecting the current period's income, as the bad debt expense was recognized in the period the account was initially written off.

The Collection of an Account That Had Been Previously Written