Putnam & Putnam , a legal firm uses the balance sheet approach to estimate uncollectible accounts expense . At year - end , an aging of the accounts receivable produced the following five groupings :

a. Not yet due..... $ 300,000

b. 1-30 days past due ...... 126,000

31-60 days past due.. 48,000

d. 61-90 days past due ... 9,000

e. Over 90 days past due 18.000

Total $ 501.000

On the basis of past experience , the company estimated the percentages probably uncollectible for the five age groups to be as follows : Group a, 1 percent Group b, 3 percent ; Group c 10 percent; Group d 20 percent; and Group e, 50 percent . The Allowance for Doubtful Accounts before adjustment at December 31 showed a credit balance of $ 7,080 .

Instructions

a. Compute the estimated amount of uncollectible accounts based on the given classification by age groups .

b. Assume that on January 10 of the following year , Putnam & Putnam learned that an account receivable that had originated on September in the amount of $5,160 was worthless because of the bankruptcy of the client , Safeland Co. Prepare the journal entry required on January 10 to write off this account.