The following are the transactions from Izzy Inc. concerning the allowance for doubtful accounts.
1. Writeoff of accounts receivable ................$5,000
2. Recovery of accounts previously written off ...........3,500
3. Accrual for bad debt expense .................4,400
Assume these are the only transactions for the year.

Instructions
(a) Record the above transactions.
(b) Prepare the reporting necessary on a partial statement of cash flows using
1. The direct method, and
2. The indirect method.