Allowance method: income statement and balance sheet approaches. Tempe Company reported accounts receivable of $300,000 and an allowance for uncollectible accounts of $31,000 (credit) on the December 31, 20X2, balance sheet. The following data pertain to 20X3 activities and operations:

Sales on account	$2,000,000
Cash collections from credit customers	1,600,000
Sales discounts	50,000
Sales returns and allowances	100,000
Uncollectible accounts written off	29,000
Collections on accounts that were previously written off	2,700

Instructions:

a. Below Prepare journal entries to record the sales- and receivables-related transactions from 20X3.

TO RECORD SALES	Debit	Credit
Accounts Receivable
Sales
TO RECORD COLLECTIONS
Cash
Sales Discounts
Accounts Receivable
TO RECORD RETURNS AND ALLOWANCES
Sales Returns & Allowances
Accounts Receivable
TO WRITE OFF UNCOLLECTED ACCOUNTS
Allowance for Uncollected accounts
Accounts Receivable
TO REINSTATE ACCOUNTS PREVIOUSLY WRITTEN OFF
Accounts Receivable
Allowance for Uncollectible Accounts
TO RECORD COLLCTIONS ON ACCOUNT
Cash
Accounts Receivable

b. Below Prepare the December 31, 20X3, adjusting entry for uncollectible accounts, assuming that uncollectible are estimated to be 2% of net credit sales.

Adjusting Entry	Debit	Credit
Uncollected Account Expense
Allowance for Uncollected Accounts

c. Below Prepare the December 31, 20X3, adjusting entry for uncollectible accounts, assuming that uncollectible are estimated at 1% of year-end accounts receivable.

Adjusting Entry	Debit	Credit
Uncollected Accounts Expense *(Ending accounts receivable)
Allowance for Uncollected Accounts
*Ending accounts receivable
Beginning Balance
Sales on account
Collections on account
Returns and allowances
Write offs
Reinstatements
Collection on reinstatements
Total
Desired balance in Allowance (total X 1%)
Existing balance
Adjusting Entry

d. Below Compute the amount of the adjusting entry in part (c), assuming that $46,000, rather than $29,000, of accounts were written off in 20X3

	Debit	Credit
Desired balance in allowance
Existing balance, debit
Adjusting Entry