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Business, 19.02.2021 21:40 martl4175

Malone started 2020 with the following: A/R $290,000 Allowance for Doubtful Accounts 25,000 (credit) Malone had the following transactions during the year. Record all of the necessary transactions. a. In summary, Malone sold $580,000 of merchandise on account and collected $480,000 from customers.

b. Three of Malone’s customers went bankrupt and Malone wrote off $26,000 of accounts receivable.

c. One of Malone’s customers that had declared bankruptcy last year would like to reestablish business with Malone. They paid Malone $4,000 in accounts receivable that Malone wrote off in 2019.

d. Record the necessary adjusting entry assuming Malone estimates bad debts at 8% of Accounts Receivable. (hint: first figure out the balance in A/R and the Allowance for Doubtful Accounts).

e. Compute and show the Net Realizable Value of Malone’s A/R after journal entries 1-4 have been recorded

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