Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is tecorded only at Decembr 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: During 2021, credit sales were $1,830,000, cash collections from customers $1,910,000, and $55,000 in accounts receivable were whitten off In addition, $4.600 was collected from a customer whose account was witten off in 2020 . An aging of accounts recelvable at December 31,2021 , reveals the following: Required: 1. Prepare summary journal entries to account for the 2021 write-otts and the collection of the receivable previously written off. 2. Prepare the yeat-end adjusting entry for bad debts according to each of the following situations: a. Bad debt expense is estimated to be 2% of credit sales for the year: b. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts recelvable to the amount of cash expected to be collected. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable. c. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance thot reduces the carrying value of accounts recelvable to the amount of cash expected to be collected The allowance for uncoliectible accounts is determined by an aging of accounts receivable. Complete this question by entering your answers in the tabs below. Prepare the year-end adjusting entry for bad debts. (If no entry is required for a transaction/event, select "No foumal entry required" in the first account field.) Journal entry worksheet Bad debt expense is estimated by computing net realizable value of the receivables. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable. Notes Enter deblits before credits, Prepare the year-end adjusting entry for bad debts. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet Bad debt expense is estimated to be 2% of credit sales IDr the year: Note: Enter debits before credits. Prepare the year-end adjusting entry for bad debts. (If no entry is required for a transaction/event, select "No journal entry required" in the first account fleld.) Journal entry worksheet Bad debt expense is estimated by computing net realizable value of the receivables. The allowance for uncollectible accounts is determined by an aging of accounts receivable. Note: Enter dobits before credits
