The bathroom is offset from the beds, located in a corner of the room near the entrance. Standard double room bathrooms are often equipped with towels, floor mats, plastic water cups, hairdryers and assorted travel size bottles of soap, shampoo, body lotion and conditioner.
Therefore a provision account called allowance for doubtful accounts is credited in the adjusting entry. Thus: The bad debts expense account, just like any other expense account, is closed to income summary account of the period. The allowance for doubtful debts is contra-asset account. Accounts Receivable. $15,000.
4. Adjust the balance of the allowance account as necessary. If the company above records another $10,000 in service revenue, another journal entry is needed to increase the allowance account. The company debits Bad Debts Expense for $200 and credits Allowance for Doubtful Accounts for $200.ccounting for doubtful debts presupposes credit sales, so begin by recording the sale in the general journal. For example, consider a company that renders $2000 of services to a customer on credit. To record the journal entry, the company debits Accounts Receivable for $2000 and credits Service Revenue for $2000.