E8-8 Recording and Reporting Allowance for Doubtful Accounts Using the Percentage of Credit Sales and Aging of Accounts Receivable Methods [LO8-2] Innovations Corp (IC) uses the percentage of credit sales method to estimate bad debts each month and then uses the aging method at year-end. During November 2020, IC sold services on account for $137,000 and estimated that 12 of one percent of those sales would be uncollectible. At Its December 31 year-end, total Accounts Receivable Is $123,500, aged as follows: (1) 1 to 30 days old. $92,500; (2) 31 to 90 days old, $21,900; and (3) more than 90 days old, $9,100. Experience has shown that for each age group, the average rate of uncollectibility Is (1) 1 percent, (2) 15 percent, and (3) 40 percent, respectively. Before the end-of-year adjusting entry is made, the Allowance for Doubtful Accounts has a $3,640 credit balance at December 31, 2020. Required: 1. Prepare the November 2020 adjusting entry for bad debts. (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

E8-8 Recording and Reporting Allowance for Doubtful Accounts Using the Percentage of Credit Sales and Aging of Accounts Receivable Methods [LO8-2] innovations Corp flC uses the perceryage of credit sales method to estmate bod debts each month and then uses the oging method at yearend. Durng November 2020 ic sold sevvces on account for $137,000 and estimated that $2 of one percent of those sales 592,500 , (2) 31 to 90 days old, $21,900, and (3) more thar 90 days old, 59,100 . Expentence has shown that for eoch age group, the averoge rate of uncollectionily is (t) 1 percent, 12 i 15 percent, and (3) 40 percent, respectively. Before the end-offyear adjusting entry is mode, the Allowance for Doubtuil Accounts has a $3,640 credir balance ot December 31,2020. Requlred: 1. Prepare the November 2020 adgusang entry for bad debts, (If no entry is required for a transectlan/event, seiect "No journal entry requlred" in the first account fieid.] Journal entry worksheet Fecind the fiovember 2020 sdjusbing entry for bsd dehts. 2. Prepsere a schedule to estmere ar apptopnots year-end balance for the Allowance for Doubrful Accouns