Carrington Company Uses the Allowance Method for Recording Bad Debts

question 4

Multiple Choice

Carrington Company uses the allowance method for recording bad debts.On February 1,Carrington wrote off a $3,500 customer account balance when it became clear that the particular customer would never pay.On May 29,Carrington unexpectedly received a check for $3,500 from the customer.On May 29,Carrington will:

• A)Debit Cash and credit Bad Debt Expense for $3,500;debit Accounts Receivable and credit Allowance for Doubtful Accounts for $3,500.
• B)Debit Allowance for Doubtful Accounts and credit Accounts Receivable for $3,500;debit Cash and credit Bad Debt Expense for $3,500.
• C)Debit Accounts Receivable and credit Allowance for Doubtful Accounts for $3,500;debit Cash and credit Accounts Receivable for $3,500.
• D)Debit Allowance for Doubtful Accounts and credit Bad Debt Expense for $3,500;debit Cash and credit Accounts Receivable for $3,500.

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Definitions:

Oocyte

Immature egg.

Post Fertilization

The stage in the reproductive process that occurs after the fusion of gametes, involving embryo development and seed formation in plants.

Embryo

An early stage of development in multicellular organisms after fertilization and before becoming a fetus, characterized by rapid cell division and differentiation.