The following selected accounts are for Keystone, Inc., a name brand shoe wholesale store, as of December 31, 1998. Prior to closing the accounts and making allowance for uncollectible accounts entries, the \(\$ 5,000\) account of Morgan Company is to be written off (this was a credit sale of February 12, 1998).

a. Prepare journal entries to record all of these transactions and the uncollectible accounts expense for the period. Assume the estimated expense is \(2 \%\) of net sales.

b. Give the entry to record the estimated expense for the period if the allowance account is to be adjusted to \(5 \%\) of outstanding receivables instead of as in a.

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Accounts receivable. Allowance for uncollectible accounts (credit) Sales.. Sales returns and allowances. $ 360,000 6,000 1,680,000 30,000