Question

Analysis of Receivables Method

At the end of the current year, Accounts Receivable has a balance of $760,000; Allowance for Doubtful Accounts has a credit balance of $7,000; and sales for the year total $3,420,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $30,100.

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 1

Requirement a

The amount of the adjusting entry for uncollectible accounts= $23100

Balance required	$ 30,100.00
Balance before adjustment	$    7,000.00
adjustment required	$ 23,100.00

Requirement b

Accounts Receivable	$7,60,000.00
Allowance for Doubtful Accounts	$   30,100.00
Bad Debt Expense	$   23,100.00

Requirement C

Accounts Receivable (Gross)	$7,60,000.00
Less: Allowance for Doubtful Accounts	$     30,100.00
Accounts Receivable (Net)	$ 7,29,900.00