Unadjusted Trial balance includes:

Dr. Cr.

Accounts receivable..................................................... $160,000

Allowance for doubtful accounts.................................. $ 3,500

Sales (all on credit)....................................................... 720,000

Sales returns and allowances........................................ 30,000

Assume they use an aging of accounts method and that historical records indicate that on accounts receivable aging, the following percentages will not be collected:

	Balance	Percentage Estimated to be Uncollectible
0-30 days outstanding	$50,000	1%
31-60 days outstanding	63,000	5%
61-90 days outstanding	28,200	10%
Over 90 days outstanding	18,800	20%

1)Compute the total estimated amount of doubtful accounts

2) Prepare the entry to record the bad debt expense for the current year