StorageTek Corporation gathered the following information from its accounting records for the year ended December, 31, 2016, prior to adjustment:
- Net credit sales for the year = $1,150,000
- Accounts Receivable (Dec 31, 2016) = $93,000
- Allowance for Uncollectible Accounts, prior to adjustment (Dec 31, 2016) = $6,000 debit balance
- StorageTek Corporation uses the allowance method of accounting for bad debts and estimates bad debts at 2.5% of net credit sales.