A company that uses the allowance method to account for its

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A company that uses the allowance method to account for its bad debts had credit sales of $740,000 in 2001, including a $720 sale to Linda Paul. On December 31, 2001, the company estimated its bad debt at 1.5% of its credit sales. On June 1, 2002, the company wrote off an uncollectible the $720 account of Linda Paul; and on Dec 25, 2002 Linda Paul unexpectedly paid her account in full. Prepare the necessary journal entries

(a) on Dec 31, 2001 to reflect the estimate of bad debts expense:

(b) on June 1, 2002, to write off the bad debt: and

Reference no: EM13581720

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