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Debra.com uses the allowance method of accounting for bad debts. The company produced the following aging of the accounts receivable at year-end. (a) Your
Debra.com uses the allowance method of accounting for bad debts. The company produced the following aging of the accounts receivable at year-end. (a) Your answer is correct. Calculate the total estimated bad debts based on the below information. 31-60 $82,000 4% 3.280 Number of Days Outstanding 61-90 $48,000 5% 91-120 Over 120 $23,000 $12,000 7% 11% 2,400 $ 1,610 $ 1,320 Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined above. Assume the unadjusted balance in Allowance for Doubtful Accounts is a $3,900 debit. (List debit entry before credit entry. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Bad Debt Expense Allowance for Doubtful Accounts Debit Credit 7:180 7,180
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