Exercise 7-5A (Algo) Analyzing financial statement effects of accounting for uncollectible accounts using the percent of revenue allowance method LO 7-1 Grover Incorporated uses the allowance method to account for uncollectible accounts expense. Grover Incorporated experienced the following four accounting events in Year 1 : 1. Recognized $84,000 of revenue on account. 2. Collected $78,000 cash from accounts receivable. 3. Wrote off uncollectible accounts of $1,300. 4. Recognized uncollectible accounts expense. Grover estimated that uncollectible accounts expense will be 2 percent of sales on account. Required a. Show the effect of each event on the elements of the financial statements, using a horizontal statements model. Use + for increase, - for decrease, and blank for not affected. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA ), investing activity (IA), financing activity (FA), or not affected (blank). The first transaction is entered as an example. b. Record the previous transactions in general journal form. Complete this question by entering your answers in the tabs below. Show the effect of each event on the elements of the financial statements, using a horizontal statements model. Use + for increase, - for decrease, and blank for not affected. In the Statement of Cash Flows column, indicate whether the item is an operating activity (OA), investing activity (IA), financing activity (FA), or not affected (blank). The first transaction is entered as an example. Record the previous transactions in general journal form. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet A D Collected $78,000 cash from accounts receivable. Record the event. Note: Enter debits before credits. Record the previous transactions in general journal form. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet Wrote off uncollectible accounts of $1,300. Record the event. Note: Enter debits before credits. Record the previous transactions in general journal form. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet Recognized uncollectible accounts expense. Grover estimated that uncollectible accounts expense will be 2 percent of sales on account. Record the event. Note: Enter debits before credits