Assuming that in exercise E12-2A the balance sheet approach is used, prepare an adjusting entry for bad debts expense. Aging of accounts receivable indicates that an $8,000 balance in the Allowance for Doubtful Accounts account will be needed to cover bad debts.

Data from in exercise E12-2A.

Given the information in the T accounts below, journalize the adjusting entry on December 31, 2021, for bad debts expense, which is estimated to be 4% of net sales. The income statement approach is used.

Transcribed Image Text:

Accounts Receivable 30,000 Sales Discounts 9,500 Sales 110,000 Allowance for Doubtful Accounts 5,000 Sales Returns and Allowances 500