Estimating Doubtful Accounts

Performance Bike Co. is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31 and a historical analysis of the percentage of uncollectible accounts in each age category are as follows:

Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31.

Performance Bike Co.
Estimation of Uncollectible Accounts
December 31
Age Interval	Balance	Estimated Uncollectible Accounts Percent	Estimated Uncollectible Accounts Amount
Not past due	$862,000	1/2%	$
1-30 days past due	94,800	4
31-60 days past due	43,100	6
61-90 days past due	31,000	14
91-180 days past due	22,400	38
Over 180 days past due	16,400	75
Total	$1,069,700		$

Providing for Doubtful Accounts

At the end of the current year, the accounts receivable account has a debit balance of $725,000 and sales for the year total $8,220,000.

1. The allowance account before adjustment has a credit balance of $9,800. Bad debt expense is estimated at 1/2 of 1% of sales.
2. The allowance account before adjustment has a credit balance of $9,800. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $31,400.
3. The allowance account before adjustment has a debit balance of $4,700. Bad debt expense is estimated at 1/4 of 1% of sales.
4. The allowance account before adjustment has a debit balance of $4,700. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $39,000.

Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above