2. Diebold Corp. made $1,500,000 in sales during 2017. Twenty percent of these were cash sales. During the year, $72,000 of accounts receivable were written off as being uncollectible. In addition, $40,000 of the accounts that were written off in 2016, were unexpectedly collected in 2017. At its' year-end December 31, 2017, Diebold had a balance of $525,000 in accounts receivable. The balance in the Allowance for Doubtful Accounts general ledger account was $112,500 credit at December 31, 2016.

Age (days)

Accounts

Receivable

1-30

$ 210,000

31-60

105,000

61-90

52,500

91-120

126,000

Over 120

31,500

Total

$525,000

Required:

1)Prepare journal entries to record the following 2017 transactions:

a.The write-off of $72,000

b.The recovery of $40,000

2)Recalculate the balance in the Allowance for Doubtful Accounts general ledger account at December 31, 2017.

3)The estimated uncollectible accounts at December 31, 2017 are calculated as follows:

Age (days)

Estimated

Loss

percentage

1-30

2%

31-60

4%

61-90

6%

91-120

10%

Over 120

40%

Required: Prepare the adjusting entry required at December 31, 2017.