At december 31, 2018, novak corp. company had a credit balance of $ 18,000 in allowance for doubtful accounts. during 2019, novak corp. wrote off accounts totaling $ 13,300. one of those accounts ($ 3,200) was later collected. at december 31, 2019, an aging schedule indicated that the balance in allowance for doubtful accounts should be $ 27,200. prepare journal entries to record the 2019 transactions of novak corp. company

Explanation:

The journal entries are shown below:

1. Allowance for Doubtful Accounts A/c Dr $ 13,300

      To Accounts receivable A/c $ 13,300

(Being written off amount is recorded)

2. Accounts receivable A/c Dr  $3,200

      To  Allowance for Doubtful Accounts A/c $3,200

(Being reverse written off)

3. Cash A/c Dr  $3,200

        To Accounts receivable A/c  $3,200

(Being amount collected)

4. Bad debt expense A/c Dr   $19,300

           To Allowance for doubtful debts   $19,300

(Being bad debt expense is recorded)

The computation of the bad debt expense is shown below:

Ending balance of Allowance for Uncollectible Accounts = Beginning balance of Allowance for Uncollectible Accounts + 2019 bad debts - 2019 write off amount  + collected amount

$27,200 = $18,000 + 2019 bad debts - $13,300 + $3,200

$27,200 = $7,900+ 2019 bad debts  

So,2019 bad debts = $27,200 - $7,900 = $19,300

turnover

the amount of money taken by a business in a particular period.

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