Question

Southwest Pediatrics has the following balances on December 31, 2021, before any adjustment Accounts Receivable =$ 118,000; Allowance for Uncollectible Accounts =$ 2,000 (debit) On December 31, 2021, Southwest estimates uncollectible accounts to be 10 % of accounts receivable.

Required:

1. Record the adjusting entry for uncollectible accounts on December 31, 2021 (ff no entry is required for a particular transaction/event, select 'No Journal Entry Required" in the first account field.)

2. 2. Determine the amount at which bad debt expense is reported in the income statement and the allowance for uncollectible accounts is reponed in the balance sheet.

3. Calculate net accounts receivable.

Answer 1

1.

Date	General journal	Debit	Credit
December 31, 2021	Baddebt expenses (($118,000*10%)+$2,000)	$   13,800
	Allowance for doubtful accounts		$   13,800

2.

Baddebt expenses (($118,000*10%)+$2,000)	$   13,800
Allowance for doubtful accounts ($118,000*10%)	$   11,800

3.

Total account receivable	$   118,000
Less: Allowance for doubtful accounts	$   (11,800)
Net accounts receivable	$   106,200

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