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Jackson Clothing Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31,
Jackson Clothing Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: || Current assets: Receivables, net of allowance for uncollectible accounts of $40,000 $360,000 During 2021, credit sales were $2.400.000, cash collections from customers $2,274,000, and $26,000 in accounts receivable were written off. In addition, $2,000 was collected from a customer whose account was written off in 2020. An aging of accounts receivable at December 31, 2021, reveals the following: Percentage of Year-End Percent Age Group Receivables in Group Uncollectible 0-60 days 60% 5% 61-120 days 35% 8% Over 120 days 5% 40% Required: (Do not enter dollar sign; do not enter thousand dollar divider) 1. What is the balance of gross (total) accounts receivable due from customers at the end of 2021? 2. What is the balance of allowance for uncollectible accounts at the end of 2021 before adjusting for bad debt expense? 3. Assume bad debt expense is estimated to be 1% of credit sales for the year, what is the balance of allowance for uncollectible accounts at the end of 2021 after adjusting for bad debt expense
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