$5($Bad$-$Debt Reporting$)$ Presented below is information related to the Accounts Receivable accounts of Gulistan Inc. during the current year $2025.$

$1.$An aging schedule of the accounts receivable as of December $31,2025,$ is as follows.

Age

Net Debit Balance

$\%$ to Be Applied After Correction Is Made

Under $60$ days

$$172,342$

$1\%$

$60-90$ days

$136,490$

$3\%$

$91-120$ days

$39,924$

$6\%$

Over $120$ days

$23,644$

$$3,700$ definitely uncollectible; estimated remainder uncollectible is $25\%$

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$$372,400$

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$*$The $$3,240$ write$-$off of receivables is related to the $91-$to$-120$ day category.

$2.$The Accounts Receivable control account has a debit balance of $$372,400$ on December $31,2025.$

$3.$Two entries were made in the Bad Debt Expense account during the year: $(1)$ a debit on December $31$ for the amount credited to Allowance for Doubtful Accounts, and $(2)$ a credit for $$3,240$ on November $3,2025,$ and a debit to Allowance for Doubtful Accounts because of a bankruptcy.

$4.$Allowance for Doubtful Accounts is as follows for $2025.$

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Allowance for Doubtful Accounts

Nov. $3$

Uncollectible accounts written off

$3,240$

Jan. $1$

Beginning balance

$8,750$

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Dec. $31$

$5\%$ of $$372,400$

$18,620$

$5.$A credit balance exists in Accounts Receivable $(60-90$ days$)$ of $$4,840,$ which represents an advance on a sales contract.

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Assuming that the books have not been closed for $2025,$ make the necessary correcting entries.

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