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Question 3 As of December 31, 2020, the balance of Accounts Receivable was $187,000. The Allowance for Doubtful Accounts, on the other hand, had a
Question 3 As of December 31, 2020, the balance of Accounts Receivable was $187,000. The "Allowance for Doubtful Accounts, on the other hand, had a credit balance of $6,800 at December 31, 2020. The balance sheet approach was used to estimate uncollectible accounts receivables. The following aging schedule was available at December 31, 2020: Age-groups 1st Group (Current) 2nd Group (1-90 days past due) 3rd Group (Over 90 days past due) Amount of receivables $98.000 $52,000 $37,000 Based on the past history, estimated percentages for uncollectible accounts were determined as 2% for the first group, 8% for the second group, and 15% for the third group, respectively. Instructions: a. Compute the estimated amount of uncollectible accounts as of December 31, 2020. b. Prepare the adjusting journal entry required at December 31, 2020. c. Compute net realizable value of accounts receivables that should be reported in the balance sheet at December 31, 2020
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