Question

The Accounts Receivable balance for Southside Company at December 31, 2017, was $26,000. During 2018, Southside earned revenue of $459,000 on account and collected $323,000 on account. Southside wrote off $5,800 receivables as uncollectible. Industry experience suggests that uncollectible accounts will amount to 2% of accounts receivable. Read the requirements Requirement 1. Assume Southside had an unadjusted $2,500 credit balance in Allowance for Bad Debts at December 31, 2018. Journalize Southside's December 31, 2018, adjustment to record bad debts expense using the percent-of-receivables method. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Accounts and Explanation Debit Credit Dec. 31 Requirement 2. Assume Southside had an unadjusted $2,200 debit balance in Allowance for Bad Debts at December 31, 2018. Journalize Southside's December 31, 2018, adjustment to record bad debts expense using the percent-of-receivables method. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Accounts and Explanation Debit Credit Dec. 31

Answer 1

Date	Accounts Title	Dr	Cr
31-Dec	Bad Debt expenses	$6,424
	Allowance for Bad debts		$6,424
	3124-(2500-5800)
	(being bad debt expenses recorded)
31-Dec	Bad Debt expenses	$11,124
	Allowance for Bad debts		$11,124
	3124-(-2200-5800)
	(being bad debt expenses recorded)
working
Ending balance of Accounts Receivable
26000+459000-323000-5800			156200
	Allowance for Bad debts ending balance
	2%*156200	3124
If any doubt please comment