At June 30, Calafate Ltd. prepared the following aging schedule:

(a) Prepare the adjusting journal entry to record bad debts expense at June 30 assuming that Calafate's allowance for doubtful accounts had a credit balance of $13,175.
(b) Prepare the adjusting journal entry to record bad debts expense at June 30 assuming that Calafate's allowance for doubtful accounts had a debit balance of $8,920 instead of a credit balance.

Transcribed Image Text:

Number of DaysAccounts Estimated Percentage Uncollectible Total Estimated Uncollectible Accounts OutstandingReceivable 0-45 days 46-90 days Over 90 days Total $ 726,00o 248,000 112,000 $1,086,00o 2% 5%, 16%