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Victory Timber Supplies uses the allowance method to account for bad debts. On 30 June 2021 the Allowance for Doubtful Debts had a debit balance
Victory Timber Supplies uses the allowance method to account for bad debts. On 30 June 2021 the Allowance for Doubtful Debts had a debit balance of $2,600 before any adjustments. Victory Timber Supplies is registered for GST. The accounts receivable aged analysis for Victory Timber Supplies at 30 June 2021 is set out below. Age Current 30 60 days overdue 61 - 120 days overdue 121 days to 6 months overdue Over 6 months overdue Estimated uncollectable 1% 2% 6% 20% 45% Accounts Receivable $327,910 56,100 13,970 23,980 14,300 $429,300 Determine the adjustment required to update the Allowance for Doubtful Debts account at 30 June 2021. Show your calculations
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