Answer:
a. To determine the amount of the adjusting entry for uncollectible accounts, we calculate the necessary adjustment by subtracting the current balance of Allowance for Doubtful Accounts from the estimated balance.
Estimated balance for Allowance for Doubtful Accounts: $225,000
Current balance of Allowance for Doubtful Accounts: $32,600
Adjusting entry for uncollectible accounts:
$225,000 - $32,600 = $192,400
b. Adjusted balances:
Accounts Receivable: $5,125,000
Allowance for Doubtful Accounts: $225,000
Bad Debt Expense: $192,400
c. Net realizable value of accounts receivable is calculated by subtracting the Allowance for Doubtful Accounts from the Accounts Receivable balance.
Net realizable value of accounts receivable:
$5,125,000 - $225,000 = $4,900,000
Step-by-step explanation: