Entries Related to Uncollectible Accounts The following transactions were completed by The Wild Trout 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. Journalized the receipt of $2,510 cash in full payment of Arlene's account Wrote off the $14,380 balance owed by Premier GS Co., which is bankrupt Apr. 3 Received 30% of the $25,800 balance owed by Hayden Co., a bankrupt business, and wrote off the remainder as uncollectible July 16 Reinstated the account of Harry Carr, which had been written off two years earlier as uncollectible. Recorded the receipt of Nov. 23. $4,090 cash in full payment Dec. 31 Wrote off the following accounts as uncollectible (one entry): Cavey Co.,$10,820; Fogle Co., $3,215; Lake Furniture, $8,260; Melinda Shryer, $2,335 Based on an analysis of the $1,271,900 of accounts receivable, it was estimated that $55,300 will be uncollectible. Journalized Dec. 31. the adjusting entry Required: 1. Record the January 1 credit balance of $52,700 in a T account presented below in requirement 2b for Allowance for Doubtful Accounts. 2. a. Journalize the transactions. For a compound transaction, if an amount box does not require an entry, leave it blank. Note: For the December 31 adjusting entry, assume the $1,271,900 balance in accounts receivable reflects the adjustments made during the year. Accounts Receivable-Arlene Gurley 2,510 Jan. 19-reinstate Allowance for Doubtful Accounts 2,510 2,510 Jan. 19-collection Cash Accounts Receivable-Arlene Gurley 2,510 Allowance for Doubtful Accounts 14,380 Apr. 3 Dec. 31-adjusting Bad Debt Expense Allowance for Doubtful Accounts v Feedback Check My Work Set up T accounts. Recall that under the allowance method, the entry to write off an account debits Allowance for Doubtful Accounts and credits Accounts Receiva In such cases where an account receivable that has been written off is later collected, the account is reinstated by an entry that reverses the w as payment for the account. The amount of bad debt expense is affected by the balance in the allowance account. 2. b. Post each entry that affects the following T accounts and determine the new balances: Allowance for Doubtful Accounts Jan. 1 Balance Apr. 3 14,380 52,700 July 16 Jan. 19 18,060 2,510 Dec. 31 24,630 Nov. 23 4,090 Dec. 31 Unadjusted Balance Dec. 31 Adjusting Entry Dec. 31 Adjusted Balance 55,300 Bad Debt Expense Dec. 31 Adjusting Entry 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 2 of 1% of the sales of $7,850,000 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)