probien 9as - KilnKraft, Inc., owned by Abby Powers, had for the past five years been engaged in Estlmating Bad) selling a line of ceramic merchandise to retail stores. Sales are made on credit and Debts: "tncome each month the company has estimated its uncollectible accounts expense as a Statement" percentage of net sales. The percentage used has been 21 of 1% of net sales, How"Bpproach and: ever, it appears that this provision has been inadequate because the Allowance for "Sheet" Ap- Doubtful Accounts has a debit balance of $6,200 at May 31 prior to making the proach monthly provision. Powers has therefore decided to change the method of estimating uncollectible accounts expense and to rely upon an analysis of the age and character of the accounts receivable at the end of each month. At. May 31, the accounts receivable totaled $380,000. This total amount included past-due accounts in the amount of $86,000. None of these past-due accounts was considered hopeless; all accounts regarded as worthless had been writ. ten off as rapidly as they were determined to be uncollectible. After careful investigation of the past-due accounts at May 31, Abby Powers decided that the probable loss contained therein was 10%, and that in addition she should anticipate a loss of 1% of the current amounts receivable. INSTRUCTIONS a Compute the probable amount of uncollectible accounts included in the accounts receivable at May 31 , based on the analysis by the owner. b Prepare the journal entry necessary to carry out the change in company policy with respect to providing for uncollectible accounts expense