Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis.

		Days Past Due
	Total			0			1 to 30			31 to 60			61 to 90			Over 90
Accounts receivable	$	670,000		$	416,000		$	110,000		$	56,000		$	38,000		$	50,000
Percent uncollectible					3	%		4	%		7	%		9	%		12	%

a.	Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 5% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method.

b.	Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $14,000 credit and $3,000 debit.

view transaction list view general journal Journal Entry Worksheet 12 Record estimated bad debts assuming that Allowance for Doubtful Accounts has a $14,000 credit balance. General Journal Debit Credit Date Dec 31 Accounts payable Accounts receivable Allowance for doubtful accounts Bad debts expense Cash Enter debits before credits Cost of goods sold do Credit card expense record entry Factoring fee expense Interest receivable Merchandise inventory Notes payable