At January 1, 2016, Hilltop Flagpoles had Accounts

At January 1, 2016, Hilltop Flagpoles had Accounts Receivable of $27,000, and Allowance for Bad Debts had a credit balance of $3,000. During the year, HilltopHilltop Flagpoles recorded the following:


a.

Sales of $ 183 comma 000$183,000 ($ 164 comma 000$164,000 on account;

$ 19 comma 000$19,000 for cash). Ignore Cost of Goods Sold.

b.

Collections on account, $ 135 comma 000$135,000.

c.

Write-offs of uncollectible receivables, $ 2 comma 800$2,800.


1.

Journalize Hilltop'sHilltop's transactions that occurred during 2016.

The company uses the allowance method.

2.

Post Hilltop's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts.

3.

Journalize Hilltop's adjustment to record bad debts expense assuming Hilltop estimates bad debts as 22% of credit sales. Post the adjustment to the appropriate T-accounts.

4.

Show how Hilltop Flagpoles will report net accounts receivable on its December 31, 2016 balance sheet.