During its first year of operations, Environmental Products Inc. had sales of $875,000, all on account. Industry

Question:

During its first year of operations, Environmental Products Inc. had sales of $875,000, all on account. Industry experience suggests that Environmental Products's bad debt expense will be $17,500. At December 31, 2016, Environmental Products's total $80,000. The company uses the allowance method to account for un-collectibles.
1. Make Environmental Products's journal entry for bad debt expense.
2. Show how Environmental Products could report on its at December 31, 2016, by disclosing the allowance for uncollectible accounts.
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