Q1) Draber Company uses allowance method based on aging method to find out estimated allowance for doubtful accounts. Below is given aging at the end of the current period with percent uncollectible experience rates:
| |
|
Number of Days Outstanding |
| |
Total |
0-30 days |
31-60 days |
61-90 days |
91-120 days |
Over 120 days |
| Accounts Receivable |
$450,000 |
$220,000 |
$100,000 |
$45,000 |
$30,000 |
$55,000 |
| %uncollectible rate |
|
2% |
4% |
6% |
8% |
10% |
If allowance for doubtful accounts before any essential adjustment is at $10,000, what adjustment will have to be made at the end of period? You may use journal entry to help reply question.