Entries Related to Uncollectible Accounts The following transactions were completed by The Wild Traut Gallery during the current fiscal year ended December 31 Jan. 19 Reinstated the account of Arlene Gurley, which had been written off in the preceding year as uncollectible. Joumalized the receipt of $2,270 cash in full payment of Arlene's account. Apr. 3 Wrate off the $13,010 balance owed by Premier GS Co., which is bankrupt. July 16 Received 30% of the $23,300 balance owed by Hayden Co., a bankrupt business, and wrote off the remainder as uncollectible. Nov. 23 Reinstated the account of Harry Carr, which had been written off two years earlier as uncollectible. Recorded the receipt of $3,700 cash in full payment. Dec. 31 Wrote off the following accounts as uncollectible (one entry): Cavey Co., $9,785; Fogle Co., $2,905; Lake Furniture, $7,470; Melinda Shryer, $2,110. 31 Based on an analysis of the $1,152,300 of accounts receivable, it was estimated that $50,100 will be uncollectible. Journalized the adjusting entry. Required: 1. Record the January 1 credit balance of $47,700 in a T account presented below in requirement 2b for Allowance for Doubtful Accounts. 2. a. Journalize the transactions. If an amount box does not require an entry, leave it blank. Note: For the December 31 adjusting entry, assume the $1,152,300 balance in accounts receivable reflects the adjustments made during the year. Jan. 19-reinstate Accounts Receivable-Arlene Gurley 2.27 Allowance for Doubtful Accounts 2.27 2.271 Jan, 19-collection Cash Accounts Receivable-Arlene Gurley 2,271 Apr. 3 13.10 Allowance for Doubtful Accounts Accounts Receivable-Premier GS Co. July 16 6.991 Cash Allowance for Doubtful Accounts Accounts Receivable-Hayden Co. 16.3 23,31 Nov. 23 reinstate Accounts Receivable-Harry Carr Allowance for Doubtful Accounts | DDDDDDDD 3,70 3,701 Nov. 23-collection Cash Accounts Receivable-Harry Carr 3.70 22.2' Dec. 31-write-off Allowance for Doubtful Accounts Accounts Receivable-Cavey Co. Accounts Receivable-Fogla Co. Accounts Receivable-Lake Furniture Accounts Receivable-Melinda Shryer 9,7% 2,90 7,471 2.111 48.11: Dec. 31-adjusting Bad Debt Expense Allowance for Doubtful Accounts 480 2. b. Post each entry that affects the following T accounts and determine the new balances: Allowance for Doubtful Accounts Jan. 19 July 16 47,70 2,270 -13,01 Dec. 31 50,101 Jan. 1 Balance 2,080 Jan. 19 48,021 Apr. 3 July 16 Dec. 31 Adjusting Entry Dec. 31 Adjusted Balance -16,31 -22,27 47,70 Bad Debt Expense Dec. 31 Unadjusted Balance 2,080 3. Determine the expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry). $ 4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivables, the adjusting entry on December 31 had been based on an estimated expense of 12 of 1% of the sales of $7,110,000 for the year, determine the following: a. Bad debt expense for the year. b. Balance in the allowance account after the adjustment of December 31. $ c. Expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry)
