Exercise 5-47 Aging Method

Spotted Singer sells karaoke machines to businesses and consumers via the Internet. On January 1, 2013, Spotted Singer Inc has an Accounts Receivable balance of $997,000 and a credit balance in its Allowance for Doubtful Accounts of $24,000. During 2013, Spotted Singer had $10,800,000 of credit sales, collected $1,725,000 of accounts receivable, and had customer defaults of $45,000. At year end, an aging analysis indicated that $28,000 of Spotted Singer's receivables will be uncollectable.

Required:

1) Calculate Spotted Singer's balance in accounts receivable on December 31, 2013, prior to the adjustment

2) Calculate Spotted Singer's balance in allowance for doubtful accounts on December 31, 2013, prior to the adjustment.

3) Prepare the necessary adjusting entry for 2013.