Answer:
a. Amount of bad debts = Sales * (Bad debts %) = $51,850,000 * 0.25% = $129,625. Thus, the amount of the adjusting entry for uncollectible accounts is $129,625.
b. The adjusted balances are as follow
Accounts Receivable $2,150,000
Allowance for Doubtful Accounts $119,125 (129,625 - 10,500)
Bad Debt Expense $129,625
c. Net realizable value of accounts receivable = Balance of accounts receivables - Allowance for Doubtful Accounts
Net realizable value of accounts receivable = $2,150,000 - $119,125
Net realizable value of accounts receivable = $2,030,875
