Answer: Please see explanation column
Explanation:
Uncollectible amount = Amount x percentage of the uncollectible amount
$170,000 x 1%
) + (15,000 x 3%
) + ( 12,000 x 6%
) + (5,000 x 12%
) + (9,000 x 30%) = 1700+450+720+600+2700= $6,170
Credit Balance from Eastman = $400
Adjustment required = $6170 - $400 (credit) = $5,770
Journal to record adjusting entry on December 31, 2012 for recognized bad debts expense.
a) Accounts Titles & Explanation Debit Credit
Bad Debt Expense $5, 770
Allowance for Doubtful Accounts $5,770
b Allowance for Doubtful Accounts account= $400 debit balance before the current year's provision for uncollectible accounts.
Adjustment required = $6170 +$400 (debit) = $6,570
Accounts Titles & Explanation Debit Credit
Bad Debt Expense $6,570
Allowance for Doubtful Accounts $6,570
