Question

# Chez Fred Bakery estimates the allowance for uncollectible accounts at 1% of the ending balance of...

Chez Fred Bakery estimates the allowance for uncollectible accounts at 1% of the ending balance of accounts receivable. During 2021, Chez Fred's credit sales and collections were \$120,000 and \$137,000, respectively. What was the balance of accounts receivable on January 1, 2021, if \$180 in accounts receivable were written off during 2021 and if the allowance account had a balance of \$570 on December 31, 2021?

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 Chez Fred Bakery Amount \$ Balance in allowance account 570.00 Uncollectible % 1% Accounts receivable (Gross) at Dec 31, 2021 57,000.00 Final Answer Amount \$ Accounts receivable (Gross) at Dec 31, 2021 57,000.00 Add: Cash collection 137,000.00 Add: Amount written of 180.00 Less: Credit sales (120,000.00) Accounts receivable (Gross) at Jan 1, 2021 74,180.00