Surf and Sun had the following balances at December 31, 2018, before the year-end adjustments:

The aging of accounts receivable yields the following data:

Requirements
1. Journalize Surf and Sun's entry to record bad debts expense for 2018 using the aging-of-receivables method.
2. Prepare a T-account to compute the ending balance of Allowance for Bad Debts.

Transcribed Image Text:

Allowance for Bad Debts |2,063 Accounts Receivable 81,000 Age of Accounts Receivable Over 60 Days $ 3,000 0-60 Days Total Receivables Accounts Receivable Estimated percent uncollectible $ 78,000 $ 81,000 x 2% x 23%