E8-1 Computing Bad Debt Expense Using Aging or Accounts Receivable method [LO 8-21 Brown Cow Dairy uses the aging approach to estimate Bad Debt Expense. The balance of each account receivable is aged on the basis of three time periods as follows: (1) 1-30 days old, $12,500; (2) 31-90 days old, $5,500; and (3) more than 90 days old, $3,500. For each age group, the average loss rate on the amount of the receivable due to uncollectibility is estimated to be (1) 4 percent. (2) 12 percent, and (3) 15 percent, respectively. At December 31 (end of the current year), the Allowance for Doubtful Accounts balance was $850 (credit) before the end-of-period adjusting entry is made Required: 1. Prepare a schedule to estimate an appropriate year-end balance for the Allowance for Doubtful Accounts 2. What amount of Bad Debt Expense should be recorded on December 317 3. If the unadjusted balance in the Allowance for Doubtful Accounts was a $650 debit balance, what amount of Bad Debt Expense should be recorded on December 31? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a schedule to estimate an appropriate year-end balance for the Allowance for Doubtful Accounts 1-30 31-00 Total Accounts Receivable Estimated Uncollectible (%) Estimated Uncollectible (5) M8-9 Recording Bad Debt Estimates Using the Two Estimation Methods (LO 8-2] Assume that Simple Co. had credit sales of $286,000 and cost of goods sold of $168,000 for the period. It estimates that 1 per credit sales in uncollectible accounts when it uses the percentage of credit sales method and it estimates that the appropriate balance in the Allowance for Doubtful Accounts is $3,500 when it uses the aging method. Before the end-of-period adjustmen made, the Allowance for Doubtful Accounts has a credit balance of $430. 1. Prepare the journal entry to record the end-of-period adjustment for bad debts under the (a) percentage of credit sales metho (b) aging of accounts receivable method. (If no entry is required for a transaction/event, select "No Journal Entry Required first account field.) View transaction list Journal entry worksheet Record the end-of-period adjustment for bad debts under the percentage of credit sales method. Note: Enter debits before credits Transaction General Journal Debit Credit