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Fowler Corporation began 2016 with an $86,000 balance in its Accounts Receivable and a $2,400 balance in its Allowance for Doubtful Accounts. The company wrote
Fowler Corporation began 2016 with an $86,000 balance in its Accounts Receivable and a $2,400 balance in its Allowance for Doubtful Accounts. The company wrote off a $600 uncollectible account during the year. Fowler Corporation uses the percent of receivables method to estimate its uncollectible accounts. The company applies the following percentages to each category in its aging of accounts receivable schedule to arrive at its 2016 year-end required allowance account balance, Number of Receivables % Likely to be Days Past Due Amount Uncollectible Current $45,000 1% 0-30 18,400 5% 31-60 10,200 10% 61-90 3,000 25% Over 90 1,800 50% Total $78,400 Required Allowance Account Balance $ 450 920 1,020 750 900 $4,040 What is Fowler Corporation's general journal entry to record its estimated uncollectible accounts at the end of 2016? Multiple Choice Uncollectible Accounts Expense Allowance for Doubtful Accounts Debit Credit 4,040 4,040 Uncollectible Accounts Expense Allowance for Doubtful Accounts Debit Credit 1,800 1,800 Uncollectible Accounts Expense Allowance for Doubtful Accounts Debit Credit 2.240 2,240 Allowance for Doubtful Accounts Uncollectible Accounts Expense Debit Credit 4,040 4,040
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