Final answer:
To calculate the year-end adjusting entry for uncollectibles, multiply the estimated uncollectibles rate with the accounts receivable balance. If the allowance account had a year-end unadjusted debit balance, subtract it from the calculated estimated uncollectibles.
Step-by-step explanation:
The December 31 year-end adjusting entry for uncollectibles can be calculated by multiplying the estimated uncollectibles rate with the accounts receivable balance. In this case, the estimated uncollectibles would be $119,000 x 1.50% = $1,785. Thus, the adjusting entry would be:
Debit: Uncollectible accounts expense - $1,785
Credit: Allowance for doubtful accounts - $1,785
If the allowance account had a year-end unadjusted debit balance of $1,300, we would subtract this debit balance from the calculated estimated uncollectibles. The adjusting entry would then be:
Debit: Uncollectible accounts expense - $485 ($1,785 - $1,300)
Credit: Allowance for doubtful accounts - $485 ($1,785 - $1,300)