Compare Too Methods of Accounting for Uncollectible Pecevable Col Systems Company, a telephone service and supply company, has just completed its fourth year of operations. The direct witool method of recording bed dett expense hos been used during the entire penod. Because of substantial increases in sales volume and the amount of uncollectible accounts, the company is considering changing to the ched. Informations requested as to the effect that an annual provision of of sales would have had on the amount of bad debt expense reported for each of the past four years. It is also considered desirable to know what the balance of Allowance for Deuttial Accounts would have been at the end of each you. The following data have been obtained from the accounts: Year of Origin of Accounts Receivable Written off as Uncollectible Uncollectible Accounts Year Sales Written oli 2nd Ird 4th 51.130,000 $1,000 $1,000 2nd 1,680,000 2,850 1,350 $1,500 2.800,000 12,200 3.550 2.800 $5,850 Ath 3.430,000 16,800 3,850 5700 57,250 Required 1. Assemble the desered dito Entet a decrease in the amount of experiena negative number and all other was as postive numbers Call Systems Company Bad Debt Expense Increase Expense Expense (Decreas) of Allowance Actually Wased on in Am Act, Year Reported Estimate of Expense End of Year Written Off 2nd 3rd 4th 51,000 Sales 51.130,000 nd 1.600.000 2,800,000 3,450.000 Required: $1,000 2.850 12.200 1,350 3,550 $1,500 2,800 16,800 $5,850 5,700 3,850 $7,250 1. Assemble the desired duta. Enter a decrease in the amount of expense as a negative number and all other amounts as positive numbers Call Systems Company Bad Debt Expense Increase Balance Expense Expense (Decrease) of Allowance Actually based on in Amount Account Year Reported Estimate of Expense End of Year 1st nd th 2. Experience during the first four years of operations indicated that the receivables were either collected within two years or had to be written off as uncollectible. Does the of als appear to be reasonably dose to the actual experience with uncollectible accounts on gating during the first two years? Yes