At December 31, Canton Imports Ltd estimates that 4 of total accounts receivable will become uncollectible Accounts receivable are $600,000 at the end of the year Allowance for Doubtful Accounts has a credit balance of $3,600 prior to recording any year end adjusting entries (a) Prepare the adjusti...

a Bad Debts Expense 20400 Allowance for Doubtful ...

At December 31, Canton Imports Ltd. estimates that 4% of total accounts receivable will become uncollectible. Accounts

Question:

At December 31, Canton Imports Ltd. estimates that 4% of total will become uncollectible. are $600,000 at the end of the year. Allowance for Doubtful Accounts has a credit balance of $3,600 prior to recording any year-end adjusting entries.
(a) Prepare the adjusting journal entry to record bad debts expense at
December 31.
(b) Assuming that Allowance for Doubtful Accounts had a debit balance of $4,000 instead of a credit balance of $3,600, how would the journal entry recorded in part (a) above change?
Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...