The accounts receivable balance for Get-N-Shape Spa at December 31,2011 , was \(\$ 80,000\). Also on that date, the balance in the Allowance for Doubtful Accounts was \(\$ 3,000\). During 2012, \(\$ 3,500\) of accounts receivable were written off as uncollectible. In addition, Get-N-Shape unexpectedly collected \(\$ 900\) of receivables that had been written off in a previous accounting period. Sales on account during 2012 were \(\$ 200,000\), and cash collections from receivables were \(\$ 190,000\). Uncollectible accounts expense was estimated to be 2 percent of the sales on account for the period.
Required

a. Record the transactions in general journal form and post to T-accounts.

b. Based on the preceding information, compute (after year-end adjustment):

(1) Balance of Allowance for Doubtful Accounts at December 31, 2012.

(2) Balance of Accounts Receivable at December 31, 2012.

(3) Net realizable value of Accounts Receivable at December 31, 2012.

c. What amount of uncollectible accounts expense will Get-N-Shape report for 2012?

d. Explain how the \(\$ 900\) recovery of receivables affects the income statement.