Assignment 2 Abu Dhabi Sign Company uses the allowance method in accounting for uncollectible accounts. Past experience indicates that 1% of net credit sales will eventually be uncollectible. Selected account balances at December 31, 2019, and December 31, 2020, appear below: 12/31/19 12/31/20 Net Credit Sales $300,000 $400,000 Accounts Receivable 60,000 80,000 Allowance for Doubtful Accounts 4,800 ? Instructions (a) Record the following events in 2020. Aug. 10 Determined that the account of L. Young for $600 is uncollectible. Sept. 12 Determined that the account of J. E. Ford for $3,400 is uncollectible. Oct. 10 Received a check for $400 as payment on account from L. Young, whose account had previously been written off as uncollectible. She indicated the remainder of her account would be paid in November. Nov. 15 Received a check for $200 from L. Young as payment on her account. (b) Prepare the adjusting journal entry to record the bad debt provision for the year ended December 31, 2020. (c) What is the balance of Allowance for Doubtful Accounts at December 31, 2020? Solution