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The carrying amount of Accounts Receivable is $17,500 before the write off of a $2,500 account....

The carrying amount of Accounts Receivable is $17,500 before the write off of a $2,500 account. Assuming the allowance method is used,” what is the carrying amount of the Accounts Receivable after the write off?

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Answer #1

When the allowance method is used, following adjustment entry will be made for write off:

Date General Journal Debit Credit
a Allowance for doubtful accounts $2500
Accounts receivable $2500
(For writing off of uncollectibles)

After the above adjustment entry is made, Accounts receivable balance will be reduced by $2500. So, carrying amount of accounts receivable after write off will be:

Carrying amount after write off = $17500 - $2500 = $15000

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