exercise 7-7

exercise 7-6 Days past Due

Total 0 1 to 30 31-60 61-90 over 90

Acounts receivalbe 570,000 396,000 90,000 36,000 18,000 30,000

Percent uncollectible 1% 2% 5% 7% 10%

Refer to the information in exercise 7-6 to complete the following requirements. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 4.5% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method. Prepare the adjusting entry to record had debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $12,000 credit. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $1,000 debit