During its first year of operations, Atlas Travel earned revenue of $400,000 on account. Industry experience suggests that Atlas Travel’s uncollectible accounts will amount to 2% of revenues. On December 31, 2010, accounts receivable total $90,000. The company uses the allowance method to account for uncollectibles.

Journalize Atlas Travel’s Uncollectible Accounts Expense using the percent-of- sales method. Show how Atlas should report Accounts Receivable on its balance sheet on December 31, 2010.