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At the end of 2014, Aramis Company has accounts receivable of $800,000 and an allowance for doubtful accounts of $40,000. On January 16, 2015, Aramis Company determined that its receivable from Ramirez Company of $6,000 will not be collected, and management authorized its write-off.
Instructions
(a) Prepare the journal entry for Aramis Company to write off the Ramirez receivable.(b) What is the net realizable value of Aramis Company's accounts receivable before the write-off of the Ramirez receivable?(c) What is the net realizable value of Aramis Company's accounts receivable after the write-off of the Ramirez receivable?
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