the year, a company has the following accounts receivable and estimates of 2. At the end...

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the year, a company has the following accounts receivable and estimates of 2. At the end of the year, a company has the follo

business accounting

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Answer 1

Answer #1

Herein Percentage of receivable method is used by the company. So let's calculate uncollectible amounts first:

1. $70000*4%=$2800.

2. $30000*15%=$4500

3. $5000*40%= $2000.

Total of above three comes to $9300. As there is debit opening balance of $1200 in Allowance for Uncollectible Accounts. So the adjustment entry will be passed by $10500 ($9300 + $1200).

General Journal	Debit	Credit
Bad Debts Expense	$10500
Allowance for Uncollectible Account		$10500

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Answer 2

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