At the end of 2017, Ivanhoe Company has accounts receivable of $877,500

At the end of 2017, Ivanhoe Company has accounts receivable of $877,500 and an allowance for doubtful accounts of $47,800. On January 16, 2018, Ivanhoe Company determined that its receivable from Ramirez Company of $7,470 will not be collected, and management authorized its write-off.

Prepare the journal entry for Ivanhoe Company to write-off the Ramirez receivable.
What is the net realizable value of Ivanhoe Company’s Accounts receivable before the write-off  of the Ramirez receivable?
What is the net realizable value of Ivanhoe Company ‘s Accounts receivable after the write-off of the Ramirez receivable?

Here’s the SOLUTION

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