. MI sells to many customers on credit. MI employs a credit manager who reviews a client's financial history prior to allowing them to buy on credit. It is MI's policy to use the allowance for doubtful accounts method based upon the aging of receivables. The balance is adjusted yearly after taking into account any adjustments for customers' accounts written off. A snapshot of Ml's current accounts receivable balance at year end shows that it has a balance of $S29,200 with an allowance for doubtful accounts debit balance of $6,000. (Note that this is prior to any adjusting journal entries that you would make.) A more detailed breakdown of the accounts receivable balance shows the following amounts aged: 0-30 days: $280,000 31-60 days: S155,000 61-90 days: $ 75,600 Greater than 90 days: S 18,600 You note that included in the above aged balances is an amount of $30,000 from a customer, Cutthroat Kitchens. This customer went bankrupt in November 2020, and there is no possibility of receiving payment from it. Fred doesn't know what to do with this amount but knows that you will. It is standard MI policy that 2% of receivables from 0 to 30 days will ultimately be uncollectible, 4% for 31-60 days, 20% for 61-90 days, and 80% greater than 90 days will be uncollect- ible. This policy is implemented after adjusting for any amounts at year end that will definitely not be collected. . In January, MI decided to stop using a significant piece of manufacturing equipment. The equipment, purchased in 2018, is still quite useful because it can be retrofitted to produce many different items, but it no longer fits within Ml's strategic plan. Details of the disposal are as follows: Year 2018 2019 2020 Cost Accumulated depreciation Net book value $750,000 $750,000 $750,000 (25.000) (50,000) (75,000 $725,000 $700,000 $675,000 According to the board of directors' meeting minutes, while management of MI intends to sell the machinery because it is only three years old and still has considerable life, the com- pany may continue to use it to produce some units until a buyer is found. Management is responsible for these asset disposal decisions. Assets can be ready within 30 days' notice, and the marketing department has begun advertising on local websites in order to sell the equipment. Based on the area in which MI is located, there are many man- ufacturers and a sale should occur in the short term. When it was advertised for sale in January 2020, MI posted an asking price of $450,000 for the equipment With respect to Cutthroat Kitchens which is the account written off, please consider this account to be part of the aging in the 61-90 day aging. This is not clear from the case information. . MI sells to many customers on credit. MI employs a credit manager who reviews a client's financial history prior to allowing them to buy on credit. It is MI's policy to use the allowance for doubtful accounts method based upon the aging of receivables. The balance is adjusted yearly after taking into account any adjustments for customers' accounts written off. A snapshot of Ml's current accounts receivable balance at year end shows that it has a balance of $S29,200 with an allowance for doubtful accounts debit balance of $6,000. (Note that this is prior to any adjusting journal entries that you would make.) A more detailed breakdown of the accounts receivable balance shows the following amounts aged: 0-30 days: $280,000 31-60 days: S155,000 61-90 days: $ 75,600 Greater than 90 days: S 18,600 You note that included in the above aged balances is an amount of $30,000 from a customer, Cutthroat Kitchens. This customer went bankrupt in November 2020, and there is no possibility of receiving payment from it. Fred doesn't know what to do with this amount but knows that you will. It is standard MI policy that 2% of receivables from 0 to 30 days will ultimately be uncollectible, 4% for 31-60 days, 20% for 61-90 days, and 80% greater than 90 days will be uncollect- ible. This policy is implemented after adjusting for any amounts at year end that will definitely not be collected. . In January, MI decided to stop using a significant piece of manufacturing equipment. The equipment, purchased in 2018, is still quite useful because it can be retrofitted to produce many different items, but it no longer fits within Ml's strategic plan. Details of the disposal are as follows: Year 2018 2019 2020 Cost Accumulated depreciation Net book value $750,000 $750,000 $750,000 (25.000) (50,000) (75,000 $725,000 $700,000 $675,000 According to the board of directors' meeting minutes, while management of MI intends to sell the machinery because it is only three years old and still has considerable life, the com- pany may continue to use it to produce some units until a buyer is found. Management is responsible for these asset disposal decisions. Assets can be ready within 30 days' notice, and the marketing department has begun advertising on local websites in order to sell the equipment. Based on the area in which MI is located, there are many man- ufacturers and a sale should occur in the short term. When it was advertised for sale in January 2020, MI posted an asking price of $450,000 for the equipment With respect to Cutthroat Kitchens which is the account written off, please consider this account to be part of the aging in the 61-90 day aging. This is not clear from the case information