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October 1, 20X2, records of Tower

Communications include these accounts:

Accounts Receivable

250.000

Allowance for Uncollectible Accounts

(8,200)

At year-end, the company ages its receivables

and

adjusts the balance in Allowance for Uncollectible

Accounts to correspond to the aging schedule.

During the last quarter of 20X2, the company

completed the following selected transactions:

Requirement 1. Record the transactions in the

journal. Explanations are not required

November 30, 20X2: Wrote off as uncollectible the

$1,200 account receivable from Rothesay Carpets

and the $500 account receivable from Somerset

Antiques. Record debits first, then credits,

Exclude explanations from journal entries.

December 31, 20X2: One of its customers, Plaza

Ltd., agreed to sign a 60-day note receivable to

replace the $1,900 accounts receivable due on

that day.

December 31, 20X2: Adjusted the Allowance for

Uncollectible Accounts and recorded Bad Debt

Expense at year-end, based on the aging of

receivables. Record debits first, then credits.

Requirement 2.

Prepare a T-account for Accounts Receivable and the Allowance for Uncollectible Accounts, and post to those accounts.

Open the T-account by posting the beginning balance. Then, post the entries to the Allowance for Uncollectible Accounts T-account, and compute the ending balance.

requirement3:

Show how Tower would report its accounts receivable on a Comparative Balance Sheet for 20X1 and 20X2. As of December 31, 20X1, the company's Accounts Receivable balance was $209,000, and the Allowance for Uncollectible Accounts stood at

$4,500.

\begin{tabular}{lcccc} \hline \multicolumn{5}{c}{ Age of Accounts } \\ \hline Total Balance & 030 Days & \begin{tabular}{c} 3160 \\ Days \end{tabular} & \begin{tabular}{c} 6190 \\ Days \end{tabular} & \begin{tabular}{c} Over 90 \\ Days \end{tabular} \\ \hline$250,000 & $148,000$ & 36,000$ & 13,000$ & 53,000 \\ Estimated uncollectible & 0.2% & 0.5% & 5.0% & 30% \\ \hline \end{tabular}

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