What must I do next mathematically to respond to the portion of the question, where it asks, "assuming the company estimates that future bad debts will equal 10% of the year-end balance in accounts receivable." in the question above.

Answer the two questions assuming the company estimates that future bad debts will equal 10% of the year-end balance in accounts receivable.

The following information relates to a company's accounts receivable: accounts receivable- balance at the beginning of the year -$300,000; -allowance for uncollectible-accounts at the beginning of the year, $25,000 (credit balance): credit sales during the year, $1.500.000,- accounts receivable written off during the year, $16,000; cash collections from customers, $1,450,000.-Assuming the company estimates bad debts at an amount equal to-2% of credit-sales, calculate (1) bad debt-expense for the year and (2) the year-end balance in the allowance for uncollectible accounts. I 1 Additional question: --Answer the two questions assuming the company estimates that-future-bad- debts-will-equal-10%-of the year-end balance in accounts receivable. It Datea Account Titles & Explanations Debito Credito 000 $1,500,0000 Accounts receivable (A+) Sales revenue (R+) Sold goods on account $1,500,0000 HHHHHHH $16,0000 Allowance for uncollectible- accounts-(CA) Accounts receivable (A-) Wrote-off bad debt-expense account $16,0000 g 19 $1,450,0000 10 Cash (A+) Accounts receivable (A-) Collected cash on accounta $1,450,000 lo $30,0000 10 $30,000 Bad debt expense (E+) Allowance for uncollectible- accounts:(CA Recorded bad debt expense-for the periodo . Beg. balanced Credit-saleso Accounts Receivable Debito Credito $300,000 $1,450,0000 $1,500,0000 $16,0000 $334,000 $1,800,000 $1,800,000 Cash collection Bad-debts-(Wrote off) Closing balanced 1 = $1,450,000+ $16,000 = $1,466,0001 =-$1,500,000-$1,466,000 =-$34,0009 =-$300,000+ $34.000 = $334,000 Credit =$1,466,000+$334,000 = $1,800,000 1 Debit =-$300,000+ $1,500,000 = $1800,000 Allowance for uncollectible receivable accounts Debito Credito Accounts receivable $16,0000 $25,000 (Wrote-off) $30,0000 Beg. balanced g Uncollectible receivable account expense (E+) Closing balanced $39,0000 $55,0000 $55,0000 1 =-$25,000+$30,000 = $55,000 1 =-$55,000-$16,000 =-$39,000 The year-end-balance and the closing balance-of-Allowance for uncollectible receivable- account is $39.000.1 Credits =-$25,000+$30,000 = $50,000 1 Debit =$16,000+ $39,000 =-$55,000 1 How the Percent-of-Sales-Method, 'or Income Statement Method, works Establish-a-pool-for-future potential uncollectibility (2%) Based on prior experience, person's uncollectible receivable account-expense is normally-2%-of net-credit-sales-(i.e., net-sales revenue), which totaled -$15,000 for the month-of-?. --The journal entry records the following at month-2, 2:1 1 Netsales revenue Formula 1 =-Sales revenue-Sales returns & allowances --Sales-discounts - =-Net-sales revenue = $1,500,000-- $0.00-$0.009 1 = $1,500,000 *2%-of net-credit-sales (or net sales revenue) 1 2 100 1 =-0.02% 1 = $1,500,000-x-0.021 = $30,000 Allowance for uncollectible accounts is another way to say: "Allowance-for-Doubtful- accounts" and "Allowance for uncollectible receivable accounts." 1 Uncollectible receivable account'expense is another way to say, "Bad-debt-expense" -and- Uncollectible account expense." /