From inception of operations to December 31, 2020, Sarasota Corporation provided for uncollectible accounts receivable under the allowance method. The provisions are recorded, based on analyses of customers with different risk characteristics. Bad debts written off were charged to the allowance account; recoveries of bad debts previously written off were credited to the allowance account, and no year-end adjustments to the allowance account were made. Sarasotas usual credit terms are net 30 days. The balance in Allowance for Doubtful Accounts was $141,900 (Cr.) at January 1, 2020. During 2020, credit sales totaled $9,030,100, the provision for doubtful accounts was determined to be $90,301, $90,301 of bad debts were written off, and recoveries of accounts previously written off amounted to $18,290. Sarasota installed a computer system in November 2020, and an aging of accounts receivable was prepared for the first time as of December 31, 2020. A summary of the aging is as follows.

Classification by Month of Sale		Balance in Each Category			Estimated % Uncollectible
NovemberDecember 2020		$1,110,400			2%
JulyOctober		660,900			10%
JanuaryJune		422,300			24%
Prior to 1/1/20		151,900			84%
		$2,345,500

Based on the review of collectibility of the account balances in the prior to 1/1/20 aging category, additional receivables totaling $58,800 were written off as of December 31, 2020. The 84% uncollectible estimate applies to the remaining $93,100 in the category. Effective with the year ended December 31, 2020, Sarasota adopted a different method for estimating the allowance for doubtful accounts at the amount indicated by the year-end aging analysis of accounts receivable.

Prepare a schedule analyzing the changes in Allowance for Doubtful Accounts for the year ended December 31, 2020. Show supporting computations in good form. (Hint: In computing the 12/31/20 allowance, subtract the $58,800 write-off.)

SARASOTA CORPORATION Analysis of Changes in the Allowance for Doubtful Accounts December 31, 2020For the Year Ended December 31, 2020For the Month Ended December 31, 2020
Write-offs for 2020Balance at January 1, 2020Balance at December 31, 2020 before change in accounting estimateBalance at December 31, 2020 adjustedRecovery in 2020 of bad debts written off previouslyProvision for doubtful accountsIncrease due to change in accounting estimate during 2020		$
Balance at January 1, 2020Balance at December 31, 2020 adjustedRecovery in 2020 of bad debts written off previouslyBalance at December 31, 2020 before change in accounting estimateProvision for doubtful accountsIncrease due to change in accounting estimate during 2020Write-offs for 2020
Balance at December 31, 2020 before change in accounting estimateRecovery in 2020 of bad debts written off previouslyBalance at January 1, 2020Provision for doubtful accountsBalance at December 31, 2020 adjustedIncrease due to change in accounting estimate during 2020Write-offs for 2020
AddLess: Balance at December 31, 2020 adjustedBalance at December 31, 2020 before change in accounting estimateProvision for doubtful accountsRecovery in 2020 of bad debts written off previouslyWrite-offs for 2020Balance at January 1, 2020Increase due to change in accounting estimate during 2020
Write-offs for 2020Balance at January 1, 2020Provision for doubtful accountsRecovery in 2020 of bad debts written off previouslyBalance at December 31, 2020 adjustedBalance at December 31, 2020 before change in accounting estimateIncrease due to change in accounting estimate during 2020
Recovery in 2020 of bad debts written off previouslyIncrease due to change in accounting estimate during 2020Provision for doubtful accountsBalance at December 31, 2020 adjustedBalance at January 1, 2020Write-offs for 2020Balance at December 31, 2020 before change in accounting estimate
Recovery in 2020 of bad debts written off previouslyWrite-offs for 2020Balance at January 1, 2020Balance at December 31, 2020 before change in accounting estimateProvision for doubtful accountsBalance at December 31, 2020 adjustedIncrease due to change in accounting estimate during 2020		$

Computation of Allowance for Doubtful Accounts at December 31, 2020
Aging Category		Balance		%		Doubtful Accounts
Nov.Dec.		$		%		$
JulyOct.				%
Jan.June				%
Prior to 1/1/20				%
						$

Prepare the journal entry for the year-end adjustment to Allowance for Doubtful Accounts balance as of December 31, 2020. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit