$3.$ Tara$$s Treasures Company sells trinkets to customers and has the following balances on

Dec. $31$st $2023$ in the following Ledgers:

Accounts Receivable: $$980,000$ DR Balance

Allowance for Doubtful Accounts: $$5,500$ CR Balance

Sales Revenue$-$Net $$1,975,000$ CR Balance

Required:

Tara is trying to decide which valuation method he should use to calculate Bad Debt Expense

and the balance in the Allowance for Doubtful $($Uncollectible$)$ Accounts....

i$.$ Assume Tara estimates that $6\%$ of the Account Receivable balance will not be paid:

i$.$ Record the adjusting entry at Dec $31$st in the Journal.

ii$.$ What is the ending value in the Allowance for Doubtful $($Uncollectible$)$

Account after the adjustment?

iii. What is the Realizable Value?

ii$.$ Assume Tara estimates that $3\%$ of the Net Sales will not be paid:

i$.$ Record the adjusting entry at Dec $31$st in the journal

ii$.$ What is the ending value in the Allowance for Doubtful $($Uncollectible$)$

Account after the adjustment?

iii. What is the Realizable Value?