Maverick Company uses the aging method to adjust the allowance for uncollectible accounts at the end of the period. At December? 31, 2014 the balance of accounts receivable is $220,000, and the allowance for uncollectible accounts has a credit balance of $3,000. Based on past? experience, Maverick estimates that the percentage of accounts that will prove to be uncollectible within the three age groups is 2%, 8%, and 20%, respectively.
Accounts Recievable Aging Information
Current $170,000
60 days past due $41,000
Over 60 days past due $9,000
Total $220,000
Based on these? facts, the adjusting entry for uncollectible accounts should be made in the amount of:
A) $5,480
b) $12,480
c) $11,480
d) $8,480