Bad debts analysis-Allowance account
Response to the following problem:
On January 1, 2013, the balance in Kubera Co.'s Allowance for Bad Debts account was $4,860. During the year, a total of $11,950 of delinquent accounts receivable was written off as bad debts. The balance in the Allowance for Bad Debts account at December 31, 2013, was $5,240.
Required:
a. What was the total amount of bad debts expense recognized during the year?
b. As a result of a comprehensive analysis, it is determined that the December 31, 2013, balance of Allowance for Bad Debts should be $11,600. Show in the horizontal model or in journal entry format the adjustment required.