MINI CASE #2 Instructions: Fill in the blanks Use this mini case to help you study Kids-At-Play is a toy store that began operations this year. At the end of its first year of operations, Kids-At-Play had accounts receivable totaling $50,000. The store's manager estimates that $1,500 of those receivables will not be collected Journal entry to record uncollectible accounts at the end of the vear 12/31 Uncollectible Accounts Expense A/c Dr S1,500 Allowance for Doubtful Accounts $1,500 The year-end balance sheet will report the following balances under the Current Assets section Accounts receivable Less allowance for doubtful accounts Net realizable value of accounts receivable $50,000 $1.500 $48,500 S 48,500 is the amount of receivables that Kids-At-Play actually expects to collect. Assume that early in the second year of operations, Kids-At-Play decides to write off as uncollectible a $500 receivable owed by Shirley Smith. This keeps the subsidiary ledger current for references on the credit standing of customers Journal entry to write off the uncollectible account Allowance for Doubtful Accounts A/C Dr. Accounts Receivable-S. Smth 5 500 Many students will want to debit Uncollectible Accounts Expense when writing off an account. Shirley Smith's $500 account was included in the $1,500 uncollectible accounts expense recorded at the end of last year. Therefore, debiting the expense account now would record the expense twice After writing off the uncollectible account, the T accounts and balance sheet would appear as follows Accounts Receivable Allowance for Doubtful Accounts Bal. 50,000 Entry to Bal. 1,500 500 -Write-off --+ 500 Account Bal. 49,500 Bal, 1,000 MINI CASE #2 Instructions: Fill in the blanks Use this mini case to help you study Kids-At-Play is a toy store that began operations this year. At the end of its first year of operations, Kids-At-Play had accounts receivable totaling $50,000. The store's manager estimates that $1,500 of those receivables will not be collected Journal entry to record uncollectible accounts at the end of the vear 12/31 Uncollectible Accounts Expense A/c Dr S1,500 Allowance for Doubtful Accounts $1,500 The year-end balance sheet will report the following balances under the Current Assets section Accounts receivable Less allowance for doubtful accounts Net realizable value of accounts receivable $50,000 $1.500 $48,500 S 48,500 is the amount of receivables that Kids-At-Play actually expects to collect. Assume that early in the second year of operations, Kids-At-Play decides to write off as uncollectible a $500 receivable owed by Shirley Smith. This keeps the subsidiary ledger current for references on the credit standing of customers Journal entry to write off the uncollectible account Allowance for Doubtful Accounts A/C Dr. Accounts Receivable-S. Smth 5 500 Many students will want to debit Uncollectible Accounts Expense when writing off an account. Shirley Smith's $500 account was included in the $1,500 uncollectible accounts expense recorded at the end of last year. Therefore, debiting the expense account now would record the expense twice After writing off the uncollectible account, the T accounts and balance sheet would appear as follows Accounts Receivable Allowance for Doubtful Accounts Bal. 50,000 Entry to Bal. 1,500 500 -Write-off --+ 500 Account Bal. 49,500 Bal, 1,000