The collection of an account that had been previously written off under the allowance method for uncollectible accounts
A)increases net income in the period of collection.
B)involves a credit to Bad Debts Expense.
C)usually requires two journal entries.
D)is recorded by debiting Cash and crediting Bad Debts Expense.

Question

Quizplus · Accepted Answer

When an account previously written off is collected, the company first reverses the write-off by debiting Accounts Receivable and crediting Allowance for Doubtful Accounts, then records the collection by debiting Cash and crediting Accounts Receivable, thus requiring two journal entries.

The Collection of an Account That Had Been Previously Written