Problem 9 : At the beginning of the year, ABC had $100,000 in Accounts Receivable and $15,000 in Allowance for Doubtful Accounts. During the year ABC sold $900,000 of product on account and collected $930,000 in cash. In addition, ABC wrote-off $10,000 of outstanding Accounts Receivable because a customer declared bankruptcy. a) Determine the ending balance in Accounts Receivable and Allowance for Doubtful Accounts before any adjusting entry or provision for bad debt expense is recorded.

b) Assuming ABC estimates uncollectible accounts as 10% of outstanding Accounts Receivable, prepare the required adjusting entry to record bad debt expense at year end.

c) Determine the Net Realizable Value of Accounts Receivable as of year end.