Question

Williams Company uses the direct write-off method to account for uncollectible receivables. On July 18, Williams wrote off a

$6,800 account receivable from customer W. Jennings. On August 24, Williams unexpectedly received full payment from Jennings

on the previously written off account.

7. Journalize Williams’s write-off on the uncollectible receivable.

8. Journalize Williams’s collection of the previously written off receivable

Short answer

(7) Bad debts expense account will be debited and accounts receivable-W.Jennings will be credited by $6,800, respectively.

(8) Firstly, accounts receivable-W.Jennings will be debited and bas debt expense will be credited by $6,800, respectively. Then, cash account will be debited and accounts receivable-W.Jennings will be credited by $6,800, respectively.

Step-by-step solution

Definition of bad debts

Bad debt is the amount that is not received from the customers.

 Journal entry for uncollectible receivable

Date	Particulars	Debit	Credit
July 18	Bad Debts Expense	$6,800
	Accounts Receivable- W. Jennings		$6,800
	(Wrote off an uncollectible account.)

Journal entry for collection of previously written off receivable

Date	Particulars	Debit	Credit
August 24	Accounts Receivable- W. Jennings	$6,800
	Bad Debts Expense		$6,800
	(Reinstated previously written off account)
August 24	Cash	$6,800
	Accounts Receivable- W. Jennings		$6,800
	(Collected cash on account)