Apply GAAP for revenue recognition, accounts receivable, and uncollectible receivables
Response to the following problem:
On September 30, Pendley Party Shop had a $56,000 balance in Accounts Receivable and a $3,000 credit balance in Allowance for Uncollectible Accounts. During October, the store made credit sales of $323,000. October collections on account were $257,000, and write-offs of uncollectible receivables totaled $3,600. Uncollectible-account expense is estimated as 3% of credit sales.