E6-23 (Algo) Recording, Reporting, and Evaluating a Bad Debt Estimate Using Aging Analysis L06-2 Brown Cow Dairy uses the aging approach to estimate bad debt expense. The ending balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, $15,000: (2) up to 120 days past due, $8,000, 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 receivables at year-end due to uncollectibility is (1) 3 percent. (2) 11 percent, and (3) 20 percent, respectively. At December 31 (end of the current year), the Allowance for Doubtful Accounts balance is $750 (credit) before the end-of-period adjusting entry is made Data during the current year follow a. During December, an Account Receivable (Patty's Bake Shop) of $700 from a prior sale was determined to be uncollectible; b. On December 31, the appropriate adjusting entry for the year was recorded Required: 1. Give the required journal entries for the two items listed above. 2. Show how the amounts related to Accounts Receivable 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. Reg 1 Reg 2A Req 28 Give the required journal entries for the two items listed above. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list View journal entry worksheet NO Debit Credit Date December 31 General Journal Allowance for doubtful accounts Accounts receivable (Patty's Bake Shop) 1 700 700 2 December 31 Bad debt expense Allowance for doubtful accounts Ren24 RA > id 25 ON Req 1 Req 2A Req 2B Show how the amounts related to Accounts Receivable and Bad Debt Expen for the current year. Disregard income tax considerations. BROWN COW DAIRY Income Statement (Partial) For the Year Ended December 31 Operating expenses: $ 0