Aging accounts receivable and accounting for bad debts P2 P3 At December 31, Hovak Co.s Allowance for Doubtful Accounts has an unadjusted debit balance of $3,400. Hovak prepares a schedule of its December 31 accounts receivable by age. Required 1. Compute the required balance of the Allowance for Doubtful Accounts at December 31 using an aging of accounts receivable. 2. Prepare the adjusting entry to record bad debts expense at December 31. page 308 Analysis Component 3. On July 31 of the following year, Hovak concludes that a customers $3,455 receivable is uncollectible and the account is written off. Does this write-off directly affect Hovaks net income? Check (2) Dr. Bad Debts Expense, $31,390