Receivables At year-end (Dec. 31), Chan inc. estimates its bad debts as 0.5% of its annual credit sales of $975,000. Chan records its estimate of uncollectible accounts (adjusting entry). On the following Feb 1, Chan decides that the $580 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. a. Prepare the journal entry of Chan to record these transactions and events of Dec 31 - step 2 Accounts Dr Cr. Bad Debt Expense C. Date Dec 31 b. Prepare the journal entry of Chan to record these transactions and events of Feb 1-step 3 Date Accounts Dr Prepare the journal entry of Chan to record these transactions and events of June 5 Date Accounts Dr 4,875 % of (Accounts) Receivable Method ii. In this method Cr. the calculated estimate represents the NEW (post adjusted) BALANCE in the allowance for Doubtful (uncollectible) Accounts. Calculate the amount to apply in the adjustment by calculating the difference between the balances before the adjustment and the new balance (just calculated) Cr. At each calendar year-end, Mazie Supply Co. uses the percent of receivables method to estimate uncollectible accounts receivable. On December 31, 2015, it has outstanding accounts receivable of $55,000, and it estimates that 2% will be uncollectible. Curated & Prepared by Jonathan Pernick Respond to the following questions for the year 2015 under the assumption that the Allowance for Doubtful Accounts has a $415 credit balance before the adjustment i. Calculate the amount the allowance for doubtful accounts should have after the adjustment. Determine the difference between the balance before & after the adjustment Page 618

Chan records its estimafe of uncollectible accounts (adjusting entry). On the following Feb 1, Olan. decides that the $540 account of P. Park is uncollectible and writes it off as a bod debe On June $. Park unexpectedly pays the amount previously written off. a. Preparmiken is b. c. I. prave une joumal entry of Chan to recond these is. % of (Accounts) Receivable Method In this method the calculated estimate represents the NEW (post adjusted) BALANCE in the allowance for Doubtful (uncollectible) Accounts. Calculate the amount to apply in the adjustment by calculating the difference between the balances before the adjustment and the new balance (just calculated) At each calendar year-end, Mazie Supply Co, uses the percent of receivables method to estimate uncollectible accounts receivable. On December 31,2015 , it has outstanding accounts receivable of $55,000, and it estimates that 2% will be uncollectible. Respond to the following questions for the year 2015 under the assumption that the Allowance for Doubtful Accounts has a $415 credit balance before the adjustment i. Calculate the amount the allowance for doubtful accounts should have after the adjostment. ii. Determine the difference between the balance before & after the adjustment Curated \& Prepared by Jonathan Pernick