Question

Warner Company’s year-end unadjusted trial balance shows accounts receivable of $99,000, allowance for doubtful accounts of $600 (credit), and sales of $280,000. Uncollectibles are estimated to be 1.5% of accounts receivable. 1. Prepare the December 31 year-end adjusting entry for uncollectibles.

Answer 1

Answer:

bad debt expense 885 debit

allowance for doubtful accounts 885 credit

Explanation:

expected uncollectibles

1.5% of AR = 99,000 x 1.5% = 1,485

current balance credit            (600)

Adjustment                              885

When calculating over account receivable, we stimated the allowance so we have to adjsut for the diference.

Answer 2

The year-end adjusting entry for uncollectibles is given in the image below.

What is journal entry?

Journal entry is the systematic record of all the financial transactions, that shows all the transactions of the business incurred in a particular period of time.

It is the primary recording of all the transactions related to the money only.

Computation of amount of expected uncollectibles:

According to the given information,

The amount of expected uncollectibles are:

$1.5\% \text{of} \text{Accounts Receivable}- \text{Currect Balance Credit}$

$= 1.5\% \times \ 99,000- 600\\=\ 885$

Therefore, the amount of expected uncollectibles are 885.

Refer, the image given below for the adjustment entry of the expected uncollectibles.

To learn more about the journal entry, refer to:

https://brainly.com/question/17439126