Obama Company has identified that Bill Clinton’s receivable account of $100 is uncollectible. What

Allowance for Doubtful Accounts 100 Accounts Receivable 100

Explanation:

The allowance method first estimates an allowance for doubtful debts.When the company receives the actual figure of the amount that have gone wrong, it writes off the  trade receivable and utilizes the allowance provided for

When allowance is estimated

Bad Debts (debit)

Allowance for doubtful debts (credit)

When the  actual figure of the amount that have gone wrong is obtained

Allowance for doubtful debts (debit)

Account Receivable (credit)

The journal entry required to write off the account under the allowance method is Bad Debt Written Off.      

Explanation:

Accounts uncollectible are receivables, loans, or other debts that have virtually no chance of being paid. An account may become uncollectible for many reasons, including the debtor's bankruptcy, an inability to find the debtor, fraud on the part of the debtor, or lack of proper documentation to prove that debt exists.

So the next right steps would be to Debit Allowance for Doubtful Debts account and Credit Accounts Receivable for Bill Clinton.    

Cheers!

Allowance for Doubtful Accounts 100 Accounts Receivable 100

Explanation: