Use the information presented in BE7.5 for Wilton, AG.
Wilton, AG had net sales in 2019 of €1,400,000. At December 31, 2019, before adjusting entries, the balances in selected accounts were Accounts Receivable €250,000 debit, and Allowance for Doubtful Accounts €2,400 credit. If Wilton estimates that 8% of its receivables will prove to be uncollectible, prepare the December 31, 2019, journal entry to record bad debt expense.
a. Instead of an Allowance for Doubtful Accounts Balance of €2,400 credit, the balance was €1,900 debit. Assume that 10% of accounts receivable will prove to be uncollectible. Prepare the entry to record bad debt expense.
b. Instead of estimating uncollectibles based on a percentage of receivables, assume Wilton prepares an aging schedule that estimates total uncollectible accounts at €24,600. (Assume an allowance of €2,400 credit.) Prepare the entry to record bad debt expense.