Percent of Sales Method

At the end of the current year,Accounts Receivablehas a balance of $865,000;Allowance for Doubtful Accountshas a credit balance of $8,000; and sales for the year total $3,890,000.Bad debt expenseis estimated at 1.25% of sales.

1.Determine the amount of the adjusting entry for uncollectible accounts.

$__________

2.Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.

Accounts Receivable $________

Allowance for Doubtful Accounts $_________

Bad Debt Expense $_______

3.Determine thenet realizable valueof accounts receivable.

$___________________