On December 31, 2014, the Landon Corporation estimated that 3% of its credit sales of $215,000 would be uncollectible. Landon used the allowance method of accounting for uncollectible accounts. On February 15, 2015, Landon wrote off the account of one of its customers, in the amount of $2,500. On April 7, 2015, the customer paid the account in full.
Which of the following answers correctly states the effect of recording the collection of the reinstated receivable on April 7, 2015?

Question

Quizplus · Accepted Answer

The Answer of On December 31, 2014, the Landon Corporation estimated that 3% of its credit sales of $215,000 would be uncollectible. Landon used the allowance method of accounting for uncollectible accounts. On February 15, 2015, Landon wrote off the account of one of its customers, in the amount of $2,500. On April 7, 2015, the customer paid the account in full.
Which of the following answers correctly states the effect of recording the collection of the reinstated receivable on April 7, 2015?

On December 31, 2014, the Landon Corporation Estimated That 3