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A company started the year with accounts receivable of $15,000 and an allowance for uncollectible accounts of $(1,500). During the year, sales (all on account) were $110,000 and cash collections for sales amounted to $105,000. Also $1,000 worth of uncollectible accounts were speciafically identified and written off. Then, at year end, the company estamiated that 10% of ending accounts receivable would be uncollectible.
a) what amount will be shown on the year-end income statement for bad debt expenses?
b) what is the balance in the allowance for uncollectible accounts after all adjustments have been made?
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