Answer:
During 2019, Sunland Company wrote off accounts totaling $12,800
Entries required - Debit Allowance for doubtful debt $12,800
Credit Accounts receivable $12,800
Being entries to write off accounts initially provided for.
One of those accounts ($1,700) was later collected.
Debit Cash account $1,700
Credit Bad debt expense $1,700
Being entries to record receipt of cash from account previously written off
At December 31, 2019, an aging schedule indicated that the balance in Allowance for Doubtful Accounts should be $26,800
Entries required - Debit Bad debt expense $24,300
Credit Allowance for doubtful debt $24,300
Being entries to recognized bad debt expense as at year end based on aging schedule.
Explanation:
When a company makes sales on account, debit accounts receivable and credit sales. Based on assessment, some or all of the receivables may be uncollectible.
To account for this, debit bad debit expense and credit allowance for doubtful debt. Should the debt become uncollectible (i.e go bad), debit allowance for doubtful debt and credit accounts receivable.
Where a debit that had previously been determined to have gone bad gets settled, debit cash and credit bad debt expense.
Given that, At December 31, 2019, an aging schedule indicated that the balance in Allowance for Doubtful Accounts should be $26,800
Adjustment required for doubtful accounts
= $26,800 - ($15,300 - $12,800)
= $24,300
