Answer:
The uncollectible accounts expense for the year be $6,075 - $1,718 = $4,357 and the required journals are:
Debit Bad debt expense $4,357
Credit Allowance for doubtful accounts $4,357
<em>(To record bad debt expense for the year)</em>
Explanation:
If all the sales were assumed to be sold on credit to the tune of $880,575, the accounts receivable would increase by that amount and the required journals are:
Debit Accounts receivable $880,575
Credit Sales revenue $880,575
<em>(To record sales transactions on account)</em>
Balance in Accounts Receivable is therefore $111,475 + $880,575 = $992,050 while its cash realizable value will be $992,050 - $6,075 = $985,975.
