Page 73 - Demo

Ch(3) : Accounting for Receivable70Illustration 3-5:In the previous Illustration 3-4,if the company had a debit balanceBD1,600 in the allowance for doubtful account before adjustment. The adjusted entry for, BD11,000(BD9,400 + BD1,600) as shown.DateExplanationDebitCreditDec,31Bad Debts Expense11,000Allowance for Doubtful Accounts11,000Post to the T. accounts are:After the adjusting entry is posted, the accounts will show the following.Bad Debt Expense Allowance for Doubtful AccountsDec 31 11,000 Bal 1600 Dec 31 11,000 Bal. 9,400Credit Card Sales:Over one billion credit cards are in use in the world more than three credit cards every man, woman, and child. Visa, Master, Diner%u2019s Club, and American ExpressCardsare the national credit are the national credit cards are used in retail sales:1-The credit card issuer, who is independent of the retailer.2-The Retailer3-The Customer.A retailer%u2019s acceptance of a national credit is another form of selling (factoring) the receivable. Objective (3)Describe the entries to record the disposition of accounts receivable.