At the completion of the current fiscal year ending December 31, the balance of Accounts Receivable for Yang’s Gift Shop was $29,910. Credit sales for the year were $353,800.
Required:
Make the necessary adjusting entry in general journal form under each of the following assumptions. Show calculations for the amount of each adjustment and the resulting net realizable value.
1. Allowance for Doubtful Accounts has a credit balance of $350.
a. The percentage of sales method is used and bad debt expense is estimated to be 2% of credit sales. If an amount box does not require an entry, leave it blank.
