In 2016 Grindstone Paving incorporated. In 2017, Grindstone Paving decided to expand their operations and start selling products to customers in addition to paving services. Grindstone will use the perpetual inventory method to track inventory. At the beginning of the year, the AFDA account had a credit balance of $9,000. Grindstone uses the allowance method to record bad debt. Record the selected transactions for the year.

Purchased $50,000 of inventory on account.

Sold inventory to a customer for $15,000 on account. The inventory had a cost of $6,000.

Feb 2

Sold inventory to a customer for $5,000 on account. The inventory had a cost of $2,000

After repeated attempts to collect from the customer on February 16, Grindstone decides to write off the account.

Sep 30

Grindstone had the following aging of accounts receivable. The only account written off during the year was on September 30. Calculate the estimated bad debt and prepare the entry.

Dec 31