Uncollectible Receivables

The Fast &Furious Car Rentals starts business on January $1,2014.$ At December $31,2014,$ the

total accounts receivable of the company are $$350,000$; out of which, management

estimates that receivables amounting to $$4,500$ will turn out to be uncollectible. At February

$12,2015,$ Astra Ltd who is a receivable of $$1,200,$ becomes bankrupt and nothing can be

recovered from them. At December $31,2015,$ the accounts receivable show a balance of

$$475,000.$ On this date, the company revises the estimates of its credit losses and

determines that receivables amounting to $$4,800$ will become uncollectible receivables.

Required:

a$.$ Prepare an adjusting entry to recognize uncollectible accounts expense at December

$31,2014.$

b$.$ Prepare an entry to write off accounts receivable at February $12,2015.$

c$.$ Prepare an adjusting entry to recognize uncollectible accounts expense at December

$31,2015.$

$(25$ marks$)$