Question

The correct entry to write off a $400 receivable owed by ajax co. using the direct write-off method would be:

Answer 1

The correct entry to write off a $400 receivable owed by Ajax Co. using the Direct Write-Off Method would be:  Debit Accounts Receivable-Ajax and credit Allowance for Doubtful Accounts for $400. Debit cash $400 and Credit Accounts Receivable $400.