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Question
At the end of the year, a company has the following accounts receivable and estimates of uncollectible accounts:
1. Accounts not yet due = $80,000; estimated uncollectible = 2%.
2. Accounts 130 days past due = $20,000; estimated uncollectible = 25%.
3. Accounts more than 30 days past due = $4,000; estimated uncollectible = 60%.
Record the year-end adjustment for uncollectible accounts, assuming the current balance of the Allowance for Uncollectible Accounts is $900 (credit).
Answer
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