QUESTION 1 (9 Marks)

Grimm Company performed an aged listing of their accounts receivable as of December 31^st as presented below:

	1-30 Days	31-60 Days	61-90-Days	Over 90 Days	Total Receivables
Amount	$160,000	$70,000	$30,000	$8,000	$268,000
Estimated Uncollectible	2%	4%	6%	30%

Management at Grimm has estimated the amount of uncollectible (doubtful) as presented in the table above. Grimm company is trying to determine how to present the Accounts Receivable on the year end financial statement. Before any adjustment is made the balance in the allowance for uncollectible accounts is a credit balance of $3,400.

Required:

1. Calculate the estimated balance in the Allowance for uncollectible accounts.
2. Prepare the entry to adjust the allowance account to the correct balance.
3. Prepare a partial balance sheet showing how the Accounts receivable and Allowance for uncollectible accounts will be presented as of December 31^st.