Q 5. At 31 July 2018, the trial balance of Odom Ltd has the following amounts before adjustment:
Accounts Receivable $350,000
Allowance for Doubtful Debts $16,625
1. Prepare the adjusting entry at 31 July 2018 for bad debts expense assuming that the ageing schedule indicates that $18,025 of accounts receivable will be uncollectable.
2. Repeat (1) assuming that instead of a credit balance, there is a $6,200 debit balance in the Allowance for Doubtful Debts before the adjusting entry.
3. A $6,060 account receivable was written off as uncollectable on 30thNovember 2018. Prepare the journal entry to record the write-off.
4. Repeat (3) assuming that Odom Ltd uses the direct write-off method instead of the allowance method in accounting for bad debts.
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