Wahlberg Design Partners (WDP) uses the aging method for its accounts receivable. On January 1, the balance
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During the year, WDP factored $600,000 of its receivables with recourse. The company received $550,000, net of a hold-back of $20,000 for potentially uncollectible accounts. Of the total amount factored, $585,000 was collected, and the factor made a final payment to WDP for $5,000.
Required:
a. Record the journal entries relating to the factoring transaction.
b. Determine the amount of bad debts expense for the year.
c. Show the journal entry to record bad debts expense for the year.
d. Show the journal entry that was used to record write-off s for the year.
Aging schedule is an accounting table that shows a company’s account receivables. It is an summarized presentation of accounts receivable into a separate time brackets that the rank received based upon the days due or the days past due. Generally...
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