Problem 7-4 (Part Level Submission) From inception of operations to December 31, 2017, Blue Corporation provided for uncollectible accounts receivable under the allowance method. The provisions are recorded, based on analyses of customers with different risk characteristics. Bad debts written off were charged to the allowance account; recoveries of bad debts previously written off were credited to the allowance account, and no year-end adjustments to the allowance account were made. Blues usual credit terms are net 30 days. The balance in Allowance for Doubtful Accounts was $121,600 at January 1, 2017. During 2017, credit sales totaled $9,083,500, the provision for doubtful accounts was determined to be $90,835, $90,835 of bad debts were written off, and recoveries of accounts previously written off amounted to $17,350. Blue installed a computer system in November 2017, and an aging of accounts receivable was prepared for the first time as of December 31, 2017. A summary of the aging is as follows. Classification by Month of Sale Balance in Each Category Estimated % Uncollectible NovemberDecember 2017 $1,230,800 2% JulyOctober 687,900 11% JanuaryJune 421,600 26% Prior to 1/1/17 163,000 77% $2,503,300 Based on the review of collectibility of the account balances in the prior to 1/1/17 aging category, additional receivables totaling $55,200 were written off as of December 31, 2017. The 77% uncollectible estimate applies to the remaining $107,800 in the category. Effective with the year ended December 31, 2017, Blue adopted a different method for estimating the allowance for doubtful accounts at the amount indicated by the year-end aging analysis of accounts receivable. Collapse question part (a) Partially correct answer. Your answer is partially correct. Try again. Prepare a schedule analyzing the changes in Allowance for Doubtful Accounts for the year ended December 31, 2017. Show supporting computations in good form. (Hint: In computing the 12/31/17 allowance, subtract the $55,200 write-off.) BLUE CORPORATION Analysis of Changes in the Allowance for Doubtful Accounts For the Year Ended December 31, 2017 Entry field with correct answer $Entry field with correct answer Entry field with correct answer Entry field with correct answer Entry field with correct answer Entry field with correct answer Entry field with correct answer Entry field with correct answer: Entry field with correct answer Entry field with incorrect answer Entry field with correct answer Entry field with incorrect answer Entry field with correct answer Entry field with incorrect answer Entry field with correct answer $Entry field with incorrect answer Computation of Allowance for Doubtful Accounts at December 31, 2017 Aging Category Balance % Doubtful Accounts NovDec 2017 $Entry field with correct answer Entry field with correct answer% $Entry field with correct answer JulyOct Entry field with correct answer Entry field with correct answer% Entry field with correct answer JanJune Entry field with correct answer Entry field with correct answer% Entry field with correct answer Prior to 1/1/17 Entry field with correct answer Entry field with correct answer% Entry field with correct answer $Entry field with correct answer