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Credit Losses Based on Accounts Receivable At December 31, Schuler Company had a balance of $386,600...

Credit Losses Based on Accounts Receivable At December 31, Schuler Company had a balance of $386,600 in its Accounts Receivable account and a credit balance of $4,200 in the Allowance for Doubtful Accounts account. The accounts receivable T-account consisted of $392,000 in debit balances and $5,400 in credit balances. The company aged its accounts as follows: Current $308,000 0-60 days past due 49,000 61-180 days past due 21,000 Over 180 days past due 14,000 $392,000 In the past, the company has experienced credit losses as follows: 1% of current balances, 5% of balances 0-60 days past due, 15% of balances 61-180 days past due, and 40% of balances over six months past due. The company bases its allowance for doubtful accounts on an aging analysis of accounts receivable. Required a. Prepare the adjusting entry to record the allowance for doubtful accounts for the year. b. Show how Accounts Receivable (including the credit balances) and the Allowance for Doubtful Accounts would appear on the December 31 balance sheet.

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