E$6-23($Algo$)$ Recording, Reporting, and Evaluating a Bad Debt Estimate Using Aging Analysis L$06-2$

Brown Cow Dairy uses the aging epproach to estimate bed debt expense. The ending balance of each account recelvable is aged on the basis of three time periods as follows: $(1)$ not yet due, $$19,000$; $(2)$ up to $120$ days past due, $$5,000$; and $(3)$ more than $120$ days past due, $$3,000.$ Experience has shown that for each age group, the average loss rate on the amount of the recelvables at year$-$end due to uncollectibiity is $(1)2$ percent, $(2)$ i$1$ percent, and $(3)30$ percent, respectively. At December $31($end of the current year$),$ the Allowance for Doubtiul Accounts balance is $$830($credit$)$ before the end$-$of$-$period adjusting entry is made.

Data during the current year follow:

a$.$ During December, an Account Recelvable $($Patty$/$s Bake Shop$)$ of $$780$ from a prior sale was determined to be uncollectible; therefore, It was written of immediately as a bed debt.

b$.$ On Decernber $31,$ the appropriate adjusting entry for the year was recorded.

Required:

Give the required journal entries for the two iteris listed above.

Show how the amounts related to Accounts Recelvable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year, Disregard income tax considerations.

Complete this question by entering your answers in the tabs below.

Req $1$

Give the required journal entries for the two items ilsted above. $($If no entry is required for a transaction$/$event$,$ select $"$No joumal antr required" in the first account field.$)$

Journal entry worksheet

$1$

$2$

Record the $$780$ account receivabin from a prior sale, that was determined to be uncollectible.

Note: Enter detits bufore credits.

$\backslash$table$[[$Date$,$Goneral Joumal,Debit,Credit$],[$Decamber $31],[(5),,,],[,,,],[,,(1),],[,,,],[,,,]]$