Blue Skies Equipment Company uses the aging approach to estimate bad debt expense at the end of each accounting year. Credit sales occur frequently on terms n/60. The balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, (2) up to one year past due, and (3) more than one year past due. Experience has shown that for each age group, the average loss rate on the amount of the receivable at year-end due to uncollectibility is (a) 3 percent, (b) 9 percent, and (C) 28 percent, respectively. At December 31, 2019 (end of the current accounting year), the Accounts Receivable balance was $48,700 and the Allowance for Doubtful Accounts balance was $920 (credit). In determining which accounts have been paid, the company applies collections to the oldest sales first. To simplify, only five customer accounts are used; the details of each on December 31, 2019, follow: Date 03/11/2018 06/30/2018 01/31/2019 B. Brown-Account Receivable Explanation Debit Credit Sale 13,000 Collection 3,000 Collection 3,800 Balance 13,000 10,000 6,200 Date 02/28/2019 04/15/2019 11/30/2019 D. Donalds-Account Receivable Explanation Debit Credit Sale 21,000 Collection 8,000 Collection 6,000 Balance 21,000 13,000 7,000 Date 11/30/2019 12/15/2019 N. Napier-Account Receivable Explanation Debit Credit Sale 8,000 Collection 1,000 Balance 8,000 7,000 Balance Date 03/02/2017 04/15/2017 09/01/2018 10/15/2018 S. Strothers-Account Receivable Explanation Debit Credit Sale 4,000 Collection 4,000 Sale 9,000 Collection 4,500 4,000 0 9,000 4,500 09/01/2018 Sale 9,000 Collection 4,500 21,000 10/15/2018 02/01/2019 03/01/2019 12/31/2019 Sale Collection Sale 9,000 4,500 25,500 20,500 24,500 5,000 4,000 Date T. Thomas-Account Receivable Explanation Debit Credit Sale 4,000 Balance 4,000 12/30/2019 Required: 1. Compute the total accounts receivable in each age category. Amount Not yet due Up to one year past due More than one year past due Total accounts receivable $ 0 2. Compute the estimated uncollectible amount for each age category and in total. Amount Not yet due Up to one year past due More than one year past due Total 0 3. Prepare the adjusting entry for bad debt expense at December 31, 2019. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the journal entry for bad debt expense at December 31, 2019. Note: Enter debits before credits. Transaction General Journal Debit Credit A Record entry Clear entry View general Journal 4. Show how the amounts related to accounts receivable should be presented on the 2019 income statement and balance sheet. Complete this question by entering your answers in the tabs below. Income Stat Bal Sheet Show how the amounts related to accounts receivable should be presented on the 2019 income statement. BLUE SKIES EQUIPMENT COMPANY Income Statement (partial) For the Year Ended December 31, 2019 Operating expenses: Income Stat Bal Sheet > Income Stat Bal Sheet Show how the amounts related to accounts receivable should be presented on the 2019 balance sheet. (Amounts to be deducted should be indicated by a minus sign.) BLUE SKIES EQUIPMENT COMPANY Balance Sheet (partial) As of December 31, 2019 Current assets:
