Acrobat Inc. has the following account balances at December 31 of the current year: Accounts...
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Accounting
Acrobat Inc. has the following account balances at December 31 of the current year: Accounts Receivable $315,000 and Allowance for Doubtful Accounts $3,300 (credit balance). Acrobat Inc. uses the aging of accounts receivable to estimate bad debts. The following aging schedule reflects the situation at year- end: Estimated Uncollectible Percentage 3.0 Age Group Balance $159,000 103,000 32,000 13,600 Account Age Current 1-30 days past due 31-60 days past due 61-90 days past due Over 90 days past due 4.5 10.0 25.0 7,400 40.0 Required: 1. Calculate the amount of the Allowance for Doubtful Accounts that should appear on the December 31, current year, balance sheet. (5 marks) 2. Prepare the journal entry to record bad debts expense for the current year. (2 marks) 3. Show how accounts receivable would appear on the December 31, current year, balance sheet. (3 marks) (no explanations are required for journal entries)
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