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Jills Jumpers has a Balance in Accounts Receivable of $42,000 and a Debit Balance in...

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Accounting

  1. Jills Jumpers has a Balance in Accounts Receivable of $42,000 and a Debit Balance in the Allowance for Doubtful Accounts of $2,200 on Dec 31, 2014. Sales on Account for 2014 were $125,000. Jill estimates that 10% of the Sales on Account will not be paid.

Required:

  1. Record the entry for Bad Debt Expense for Dec 31, 2014

$125,000 x .10 = $12,500 Dr. Cr.

Bad Debt Expense $12,500

Allowance for Bad Debt $12,500

  1. What is the ending Balance in the Allowance for Uncollectible Accounts on Dec 31, 2014?

12,500 2,200 = $10,300

  1. What is the realizable value on Dec 31, 2014?

125,000 10,300 = $114,700

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