Cornerstone Exercise 5-28 (Algorithmic) Aging Method On January 1, 2019, Smith, Inc., has the following balances for accounts receivable and allowance for doubtful accounts: $389,000 Accounts Receivable Allowance for Doubtful Accounts (a credit balance) 3,900 During 2019, Smith had $2,875,000 of credit sales, collected $2,905,000 of accounts receivable, and wrote off $3,850 of accounts receivable as uncollectible. At year end, Smith performs an aging of its accounts receivable balance and estimates that $3,800 will be uncollectible. Required: 1. Calculate Smith's preadjustment balance in accounts receivable on December 31, 2019. 2. Calculate Smith's preadjustment balance in allowance for doubtful accounts on December 31, 2019. Feedback Check My Work 1 & 2. Using T-accounts, start with the balance at the beginning of the year and make the necessary debits and/or credits for the transactions that occurred during the year. 3. Prepare the necessary adjusting entry for 2019. Bad Debt Expense Allowance for Doubtful Accounts Record adjusting entry for bad debt expense estimate Feedback Check My Work 3. The aging method attempts to estimate the ending balance in the Allowance for Doubtful Accounts