At December 31, 2016, Surabaya Corporation reported the following information on its statement of financial position.

Instructions

1. Prepare the journal entries to record each of these five transactions. Assume that no cash discounts were taken on the collections of accounts receivable.
2. Enter the January 1, 2017, balances in Accounts receivable and Allowance for Doubtful Accounts, post the entries to the two accounts (use T-accounts), and determine the balances.
3. Prepare the journal entry to record bad debt expense for 2017, assuming that an aging of accounts receivable indicates that bad debts are $125,000.

Accounts receivable Less: Allowance for doubtful accounts $960.000 66,000 During 2017, the company had the following transactions related to receivables. 1 2 3 4 15 Sales on account Sales retums and allowances Collections of accounts receivable Write-offs of accounts receivable deemed uncollectible Recovery of bad debts previously written off as uncollectible $3,315,000 50.000 2.810,000 88,000 29,000