Problem 7-3 (Part Level Submission) Pearl Corporation operatesin an industry that has a high rate of bad debts. Before anyyear-end adjustments, the balance in Pearl's Accounts Receivableaccount was $595,600 and Allowance for Doubtful Accounts had acredit balance of $40,350. The year-end balance reported in thebalance sheet for Allowance for Doubtful Accounts will be based onthe aging schedule shown below. Days Account Outstanding AmountProbability of Collection Less than 16 days $314,500 0.97 Between16 and 30 days 119,900 0.90 Between 31 and 45 days 84,800 0.85Between 46 and 60 days 43,000 0.82 Between 61 and 75 days 19,8000.53 Over 75 days 13,600 0.00 Assume that accounts with a zeropercent chance of collection are intended to be written off.Collapse question part (a) What is the appropriate balance forAllowance for Doubtful Accounts at year-end? Balance for Allowancefor Doubtful Accounts
