I need help with Number 3 please (the \"Dec 31 Estimated that 10% of accounts re

Question

I need help with Number 3 please (the "Dec 31 Estimated that 10% of accounts receivable recorded to date would be uncollectible").:

Outdoor Equipment (OE) sells camping equipment. On December 1, the accounts receivable account had a balance of $51,400, the bad debt expense account had a balance of $0, and the allowance for doubtful account had a credit balance of $5,140. Journalize the remaining journal entries for the 2017 year.

Dec. 2 Sold tents for $5,280 on account with a cost of $2,640.
      20 Determined that the total accounts of Rocky Co. with an accounts receivable balance of $1,340 and Grouse Co. with an accounts receivable balance of $2,640 were uncollectible and needed to be written off.
      23 Unexpectedly received payment from Grouse Co. for $2,640.
      31 Estimated that 10% of accounts receivable recorded to date would be uncollectible.

Also if you could please explain how you get the answer.. :)

Explanation / Answer

Journal entries Date Account titles & Explanations Debit Credit 2-Dec Accounts receivable 5,280 sales 5,280 Cost of goods sold 2,640 Merchandise inventory 2,640 20-Dec Allowance for Doubtful account 3980 Accounts recievable 3980 23-Dec Accounts receivable 2,640 Allowance for Doubtful accounts 2,640 Cash 2,640 Accounts receivable 2,640 31-Dec Bad debts expense 1,470 Accounts receivable 1,470 T- Accounts Account receivable opening 51,400 20-Dec 3980 2-Dec 5,280 23-Dec 2,640 23-Dec 2,640 end bal 52,700 Allowance for Doubtful accounts 20-Dec 3980 opening 5,140 23-Dec 2,640 bad debts 1,470 end bal 5,270 Estimated bad debts = 52,700*10%= 5,270

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