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Creative Solutions Company, a computer consulting firm, has decided to write off the $11,750 balance of an account owed by a customer, Wil Treadwell.
Journalize the entry to record the write-off, assuming that the direct write-off method is used.

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Answer:

DR Bad Debts Expense $11,750

CR Accounts Receivable $11,750

(To record accounts receivable written off)

Explanation;

Direct method of writing off involves removing the bad debt directly from the Accounts Receivable account instead of using the Allowance for Doubtful debt account.