At December 31, 2016, Canning Travel Agency has an Accounts Receivable balance of $89,000. Allowance for Doubtful Accounts has a credit balance of $840 before the year-end adjustment. Service revenue (all on account) for 2016 was $600,000. Canning estimates that doubful-account expense for the year is % of service revenue.

Requirement

1. Make the year-end entry to record doubtful-account expense. Show how Accounts Receivable and Allowance for Doubtful Accounts are reported on the balance sheet at December 31, 2016.

Show how Accounts Receivable and the Allowance for Doubtful Accounts are reported on the balance sheet at December 31, 2016.