At the end of the current year, Accounts Receivable has a balance of $405,000; Allowance for Doubtful Accounts has a debit balance of $3,500; and sales for the year total $1,820,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $18,200.
a. Determine the amount of the adjusting entry
for uncollectible accounts.
$
b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.
Accounts Receivable | $ |
Allowance for Doubtful Accounts | $ |
Bad Debt Expense | $ |
c. Determine the net realizable value of
accounts receivable.
$
Answer | ||
a |
||
Amount of the adjusting entry | $ 21,700 | 18200+3500 |
b | ||
Accounts Receivable | $ 405,000 | |
Allowance for Doubtful Accounts | $ 18,200 | |
Bad Debt Expense | $ 21,700 | |
c | ||
Net realizable value of accounts receivable | $ 386,800 | 405000-18200 |
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