On January 1, 2013, Barksdale Company had a balance in Accounts Receivable of $45,000 and a balance in the Allowance for Doubtful Accounts account of $1,200. During 2013 Barksdale had credit sales of $122,000 and ended the year with a balance in Accounts Receivable of $24,000. During 2013 Barksdale also wrote off $550 of receivables. Barksdale uses the allowance method for uncollectible accounts and assumes that 2% of the sales on account will not be collected.
Required:
a) After adjusting entries on 12/31/13, what will be the balance in the Allowance for Doubtful Accounts?
b) By what amount did net realizable value of accounts receivable decrease in 2013 due to the write-off of the receivable?
c) What amount of cash was collected from customers during 2013?

Question

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The Answer of On January 1, 2013, Barksdale Company had a balance in Accounts Receivable of $45,000 and a balance in the Allowance for Doubtful Accounts account of $1,200. During 2013 Barksdale had credit sales of $122,000 and ended the year with a balance in Accounts Receivable of $24,000. During 2013 Barksdale also wrote off $550 of receivables. Barksdale uses the allowance method for uncollectible accounts and assumes that 2% of the sales on account will not be collected.
Required:
a) After adjusting entries on 12/31/13, what will be the balance in the Allowance for Doubtful Accounts?
b) By what amount did net realizable value of accounts receivable decrease in 2013 due to the write-off of the receivable?
c) What amount of cash was collected from customers during 2013?

On January 1, 2013, Barksdale Company Had a Balance in Accounts