Domitian Corporation accounts for uncollectible accounts receivable using the allowance method. As of December 31, 2011, the credit balance in Allowance for Bad Debts was $170,000. During 2012, credit sales totaled $12,000,000, $105,000 of accounts receivable were written off as uncollectible, and recoveries of accounts previously written off amounted to $10,000. An aging of accounts receivable at December 31, 2012, showed the following:

Required:
1. Prepare the journal entry to record bad debt expense for 2012, assuming bad debts are estimated using the aging of receivables method.
2. Record journal entries to account for the actual write-off of $105,000 uncollectible accounts receivable and the collection of $10,000 in receivables that had previously been writtenoff.

Transcribed Image Text:

Accounts Receivable Balance as of December 31, 2012 Percentage Estimated Uncollectible Classification of Receivable Current 1-30 days past due 31-60 days past due Over 60 days past due... S1,690,000 720,000 380,000 90,000 S2,880,000 2% 20 75