Accounting for uncollectable accounts-the balance sheet method
At may 31, the accounts receivble at biway centralamounted int total to $705,600. The company uses the balance sheet approach to estimate bad debts and has prepared an aging schedule of accounts receivable at MAY 31 which indicates an expected loss of $17,568. You are to prepare as of MAY 31 the adjusting entry required under each of the following independent assumptions. The explanation portion of each entry should include appropriate supporting computations, and amount should be rounded to the nearest dollar.
a. THE ALLOWANCE FOR DOUBTFUL ACCOUNTS has a credit balance of $12,672.
b. THE ALLOWNCE FOR DOUBTFUL ACCOUNTS hs a debit balabce of $4,262.
