Gideon Company Uses the Direct Write-Off Method of Accounting for Uncollectible

question 22

Multiple Choice

Gideon Company uses the direct write-off method of accounting for uncollectible accounts. On May 3, the Gideon Company wrote off the $2,000 uncollectible account of its customer, A. Hopkins. On July 10, Gideon received a check for the full amount of $2,000 from Hopkins. On July 10, the entry or entries Gideon makes to record the recovery of the bad debt is:

• A) \[\begin{array} { | l | r | r | }
• \hline \text { Allowance for Doubtful Accounts } & 2,000 & \\
• \hline \text { Accounts Receivable -A. Hopkinse } & & 2,000 \\
• \hline \text { Accounts Receivable -A. Hopkins } & 2,000 & \\
• \hline \text { Cash } & & 2,000 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | r | r | }
• \hline \text { Accounts Receivable -A. Hopkins } & 2,000 & \\
• \hline \text { Bad debts expense } & & 2,000 \\
• \hline \text { Cash } & 2,000 & \\
• \hline \text { Accounts Receivable -A. Hopkins } & & 2,000 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | l | r | r | }
• \hline \text { Accounts Receivable -A. Hopkins } & 2,000 & \\
• \hline \text { Allowance for Doubtril Accounts } & & 2,000 \\
• \hline \text { Cash } & 2,000 & \\
• \hline \text { Accounts Receivable -A. Hopkins } & & 2,000 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | l | r | r | }
• \hline \text { Cash } & 2,000 & \\
• \hline \text { Accounts Receivable -A. Hopkins } & & 2,000 \\
• \hline
• \end{array}\]
• E) \[\begin{array} { | l | r | r | }
• \hline \text { Cash } & 2,000 & \\
• \hline \text { Bad debts expense } & & 2,000 \\
• \hline
• \end{array}\]

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