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Question 1: At the end of the current year, Accounts Receivable has a balance of $800,000; Allowance for Doubtful Accounts has a credit balance of
Question 1:
At the end of the current year, Accounts Receivable has a balance of $800,000; Allowance for Doubtful Accounts has a credit balance of $7,500; and sales for the year total $3,500,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated at $30,000.
Determine:
- the amount of the adjusting entry for uncollectible accounts;
- the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense; and
- the net realizable value of accounts receivable.
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