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Collectability of the outstanding receivable balance

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Reference no: EM133068038

Makeit Incorporated received a letter on October 25, 2013 from Gesters Corporation; one of the companies long standing customers who has a receivables balance with Makeit Inc in the amount of $98,250; the letter communicated to Makeit Inc, that Gesters Corp was filing for bankruptcy and would not be able to pay their outstanding receivable balance. Based on the information communicated by Gesters Corp management of Makeit Inc believes that it is unlikely that they will ever recover the outstanding receivable balance. Prepare the necessary journal entry to account for Makeit Inc's conclusion on the collectability of the outstanding receivable balance.

Reference no: EM133068038

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