Novakowski Products needs to prepare their year$-$end financial statements. On December $31,2021,$ the balance in Accounts Receivable was $$680,000.$ An aging analysis of the accounts receivable indicated that $$16,500$ of the accounts receivable is expected to be uncollectible.

Instructions

a$)$ Prepare the adjusting entries to record estimated bad debt expense using the percentage of receivables approach for each independent assumption:

i$)$Allowance for Doubtful Accounts has a credit balance of $$3,200$ before adjustment.

ii$)$Allowance for Doubtful Accounts has a debit balance of $$730$ before adjustment.

b$)$ Determine the carrying amount of the accounts receivable at December $31,2021$ after the required adjustments under each assumption.