Newton Company uses the allowance method of accounting for uncollectible accounts. On May 3, the Newton Company wrote off the $3,000 uncollectible account of its customer, P. Best. The journal entry on May 3 is:
a. Dr allowance for doubtful debts 3000
Cr account receivable 3000
b. Dr bad debt expense 3000
Cr account receivable 3000
c. Dr bad debt expense 3000
Cr Allowance for doubtful debt 3000
d. Dr account receivable 3000
Cr bad debt expense 3000
e. Dr Accounts receivable 3000
Cr Cash 3000
Answer:
a. Dr allowance for doubtful debts 3000
Cr account receivable 3000
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