Chapter 9, Problem E9.19E

Accounting for uncollectible accounts using the allowance method (percent-of-receivables) and reporting receivables on the balance sheet

Learning Objectives 1, 3 3. Bad Debts Expense $4,770

Requirements
1. Journalize Hilltop’s transactions that occurred during 2018. The company uses the allowance method.
2. Post Hilltop’s transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts.
3. Journalize Hilltop’s adjustment to record bad debts expense assuming Hilltop estimates bad debts as 10% of accounts receivable. Post the adjustment to the appropriate T-accounts.
4 Show how Hilltop Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet