Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following. Current assets:    Receivables, net of allowance for uncollectible accounts of $45,000            $507,000   During 2021, credit sales were $1,825,000, cash collections from customers $1,905,000, and $54,000 in accounts receivable were written off. In addition, $4,500 was collected from a customer whose account was written off in 202. An aging of accounts receivable at December 31, 2021, reveals the following:                                                                                   Percentage of Year-End                              Percent Age Group                                                       Receivables in Group                               Uncollectible 0-60 days                                                                            70%                                                        5% 61-90 days                                                                          20                                                         15 91-120 days                                                                          5                                                         20 Over 120 days                                                                      5                                                         40   Required: Prepare the year-end adjusting entry for bad debts according to each of the following situations: Bad debt expense is estimated to be 4% of credit sales for the year. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is determined by an aging of accounts receivable.   No             Transaction                                   General Journal                                  Debit                      Credit 2                      b.                                       _____________________                   _________       ___________                                                                   ______________________                 _________       ____________   Required: For situations (a) –(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2021 balance sheet?

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following.

Current assets:

   Receivables, net of allowance for uncollectible accounts of $45,000            $507,000

During 2021, credit sales were $1,825,000, cash collections from customers $1,905,000, and $54,000 in accounts receivable were written off. In addition, $4,500 was collected from a customer whose account was written off in 202. An aging of accounts receivable at December 31, 2021, reveals the following:

                                                                                Percentage of Year-End                              Percent

Age Group                                                       Receivables in Group                               Uncollectible

0-60 days                                                                            70%                                                        5%

61-90 days                                                                          20                                                         15

91-120 days                                                                          5                                                         20

Over 120 days                                                                      5                                                         40

Required:

1. Prepare the year-end adjusting entry for bad debts according to each of the following situations:
2. Bad debt expense is estimated to be 4% of credit sales for the year.
3. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable.
4. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is determined by an aging of accounts receivable.

No             Transaction                                   General Journal                                  Debit                      Credit

2                      b.                                       _____________________                   _________       ___________

                                                                  ______________________                 _________       ____________

Required:

1. For situations (a) –(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2021 balance sheet?

                    Net amount

              Receivable reported

1. ____________________
2. ____________________
3. ____________________