Question

At the end of the current year, Accounts Receivable has a balance of $4,375,000; Allowance for Doubtful Accounts has a debit balance of $21,300; and sales for the year total $102,480,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $205,000.

a. Determine the amount of the adjusting entry for uncollectible accounts.

Answer 1

$226,300

Explanation:

Given Allowance for Doubtful Accounts is estimated as $205,000 and Allowance for Doubtful Accounts has a debit balance of $21,300

#The amount of the adjusting entry for uncollectible accounts is calculated as below:

`Adjustment \ Cost=Allowance\ Doubtful\ Accounts +Doubtful \ Accounts \ Debit \ Balance\\\\=205000+21300\\\\\$226,300`

Hence, the amount of the adjusting entry for uncollectible accounts is $226,300