Question

Solstice Company determines on October 1 that it cannot collect $57,000 of its accounts receivable from its customer P. Moore. It uses the direct write-off method to record this loss as of October 1. On October 30, P. Moore unexpectedly pays his account in full to Solstice Company. Record Solstice’s entry(ies) to reflect recovery of this bad debt.

Answer 1

Answer:

The answer is given below;

Explanation:

Accounts Receivable-P. Moore Dr.$57,000

Bad Debt Expense      Cr.$57,000

Firstly the write off made on Oct-1  will be reinstated to amount being collected from P.Moore as above.

Cash   Dr.$57,000

Accounts Receivable-P.Moore Cr.$57,000

In this journal entry, we have recorded collection of cash from customer