Answer:
Journal Entry
Explanation:
1. Cash Dr, $136,800
Sales Discount Dr, $1,200
($60,000 × 2%)
To Accounts receivable $138,000
(Being cash is recorded)
2. Accounts receivable Dr, $5,300
To Allowance for doubtful accounts $5,300
(Being written off is recorded)
Cash Dr, $5,300
Accounts receivable $5,300
(Being payment received is recorded)
3. Allowance for doubtful accounts Dr, $17,500
To Accounts receivable $17,500
(Being written off is recorded)
4. Bad Debts expense Dr, $14,900
=$20,000 - ($17,300 + $5,300 - $17,500)
To Allowance for doubtful accounts $14,900
(Being bad debt expenses is recorded)
