Terranova. uses the balance sheet approach in estimating uncollectible accounts expense. Its Allowance for Doubtful Accounts has a €2,000 credit balance prior to adjusting entries. It has just

completed an aging analysis of accounts receivable at 31 December 2020. This analysis disclosed

the following information:

	Age Group Total	Percentage Considered Uncollectible
Not yet due	$ 200,000	1%
1 – 30 days past due	$ 70,000	2%
31 – 60 past due	$ 10,000	17%

(a) Using the table above, calculate the appropriate balance for Terranova´s Allowance for Doubtful

Accounts at 31 December 2020.

(b) Prepare the year-end adjusting entry for uncollectible accounts.

Date	Account Titles	Debit	Credit