Answer:
Bad Debts Expense Debit $ 34,440
Allowance for Uncollectible accounts Credit $ 34,440
Explanation:
Computation of amount of uncollectible balances to be recorded
Total accounts Receivable $ 300,000
Accounts past due <u>$ 51,000</u>
Accounts not yet past due $ 249,000
Estimated uncollectible from not yet past due 10 %
Estimated uncollectible from past due 24 %
Estimated uncollectible from not yet past due 10 % * $ 249,000 = $ 24,900
Estimated uncollectible from past due 24 % * $ 51,000 = <u>$ 12,240</u>
Total Estimated Uncollectible amounts = $ 37,140
Available balance in Allowance account $ (2,700)
Allowance for uncollectible accounts to be recorded <u>$ 34,440</u>
