Estimating Uncollectible Accounts and Reporting Accounts Receivable

Mohan Company estimates its uncollectible accounts by aging its accounts receivable and applying percentages to various aged categories of accounts. Mohan computes a total of $2,100 in estimated uncollectible accounts as of its current yearend. Its accounts receivable has a balance of $86,000, and its allowance for uncollectible accounts has an unused balance of $700 before any yearend adjustments.

a.What amount of bad debt expense will Mohan report in its income statement for the current year? $Answer

b.Determine the net amount of accounts receivable reported in current assets at yearend. $Answer