[The following information applies to the questions displayed below.] There was

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[The following information applies to the questions displayed below.]

There was objective evidence that 11% of a $144,000 debt owed by a debtor, Nathan Company, would most probably be uncollectible. An aging analysis of the rest of the accounts receivables indicated that an estimated 6% of these accounts would not be collectible.

Prepare the adjusting entry for this company to recognize bad debts.(Round your intermediate calculations and and final answers to the nearest dollar amount. Omit the "$" sign in your response.)

Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31, 2015 statement of financial position. (Amounts to be deducted should be indicated with minus sign. Omit the "$" sign in your response.)

[The following information applies to the questions displayed below.]

Explanation / Answer

1. Allowances for Doubful Accounts Dr. 73575.18 (144000*11% +962253*6%)

Accounts receivable Cr. 73575.18

2. Statement of financial position as on December 31, 2015

Accounts receivable (1,106,253- 73575.18) = 1032677.82 Debit

Allowances for Doubful Accounts  (73575.18+23,000) = 96575.18  Debit

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