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Warner Company’s year-end unadjusted trial balance shows accounts receivable of $112,000, allowance for doubtful accounts of $730 (credit), and sales of $410,000. Uncollectibles are estimated to be 1.50% of accounts receivable. 1. Prepare the December 31 year-end adjusting entry for uncollectibles.

Respuesta :

Answer:

Debit bad debt expenses with $1,680, and credit Accounts receivable also with $1,680.

Explanation:

Uncollectibles = Accounts receivable × 1.50% = $112,000 × 1.50% = $1,680

The December 31 year-end adjusting entry for uncollectibles will be as follows:

Details                                                 Dr ($)                  Cr ($)                

Bad debt expenses                            1,680

Accounts receivable                                                      1,680

Being the amount Accounts receivable estimated to be uncollectible

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