At December 31, Gill Co. reported accounts receivable of $238,000 and an allowance for uncollectible accounts of $1,200 (debit) before any adjustments. An analysis of accounts receivable suggests that the allowance for uncollectible accounts should be 3% of accounts receivable. The amount of the adjustment for uncollectible accounts would be:

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Business

Heidy Mathis

9 January, 05:44

At December 31, Gill Co. reported accounts receivable of $238,000 and an allowance for uncollectible accounts of $1,200 (debit) before any adjustments. An analysis of accounts receivable suggests that the allowance for uncollectible accounts should be 3% of accounts receivable. The amount of the adjustment for uncollectible accounts would be:

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Zander Wilcox · Answer 1

Gross Accounts Receivable 238,000

Allowance 3%

Required balance in allowance for uncollectible accounts 7,140

Add: Existing debit balance 1,200

Required adjustment $8,340