At the end of the current year, the accounts receivable account of Parker's Nursery Supplies has a debit balance of $350,000. Credit sales are $2,300,000.
Record the end-of-period adjusting entry on December 31, in general journal form, for the estimated uncollectible accounts. Assume the following independent conditions existed prior to the adjustment:
1. Allowance for Bad Debts has a credit balance of $1,920.
(a) The percentage of sales method is used and bad debt expense is estimated to be 1% of credit sales.
(b) The percentage of receivables method is used and an analysis of the accounts produces an estimate of $24,560 in uncollectible accounts.
2. Allowance for Bad Debts has a debit balance of $1,280.
(a) The percentage of sales method is used and bad debt expense is estimated to be ?3 of 1% of credit sales.
(b) The percentage of receivables method is used and an analysis of the accounts produces an estimate of $22,440 in uncollectible accounts.