Question

Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined above. Assume the unadjusted balance in Allowance for Doubtful Accounts is a $3,600 debit. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit enter an account title for the adjusting entry to record the bad debts Bad Debt Expense enter a debit amount enter a credit amount enter an account title for the adjusting entry to record the bad debts Allowance for Doubtful Accounts

Answer 1

Find attached missing part:

Dr bad debt expense $ 22,050.00

Cr allowance for doubtful accounts $ 22,050.00

Step-by-step explanation:

The estimated balance of uncollectible debts is the accounts receivable of $570,000 multiplied by 4.5% which is the rate of uncollectible debt given in the question.

Estimated balance of uncollectible debt=$570,000*4.5%=$ 25,650.00

The adjusting entries required to record bad debts as per the amount computed above is the estimated balance of uncollectible of $ 25,650.00 minus the debit balance of $3,600 already in the unadjusted balance in allowance for doubtful debts.

adjusting amount=$ 25,650.00-$3,600.00=$ 22,050.00