Discount Mart Utilizes the Allowance Method of Accounting for Uncollectible

question 4

Essay

Discount Mart utilizes the allowance method of accounting for uncollectible receivables. On December 12th the company receives a $550 check from Chad Thomas in settlement of Thomas' $1,100 outstanding accounts receivable. Due to Thomas' failing health he is closing his company and is expecting to make no further payments to Discount Mart. Journalize this declaration.

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Definitions:

Unpleasant Event

An occurrence that causes discomfort, distress, or dissatisfaction to an individual.

Desired Employee Behavior

The specific actions or reactions that an organization encourages and rewards in its employees to achieve its objectives.

Positive Reinforcement

The addition of a rewarding stimulus following a desired behavior, increasing the likelihood of that behavior being repeated.

Punishment

A method used to reduce undesirable behavior by applying negative consequences or removing positive reinforcements.