E8-15 At December 31, 2012, the Accounts receivable balance of GPS Technology is

Price: $2.99

E8-15 Accounting for uncollectible accounts using the allowance method

and reporting receivables on the balance sheet [15–30 min]

At December 31, 2012, the Accounts receivable balance of GPS Technology is

$190,000. The Allowance for doubtful accounts has an $8,600 credit balance. GPS

Technology prepares the following aging schedule for its accounts receivable:

Age of Accounts

Accounts receivable

1–30

Days

$80,000

0.4 %

31–60

Days

$60,000

5.0 %

61–90

Days

$40,000

6.0 %

Over 90

Days

$10,000

50.0 %

Requirements

1. Journalize the year-end adjusting entry for doubtful accounts on the basis of the

aging schedule. Show the T-account for the Allowance for uncollectible accounts

at December 31, 2012.

2. Show how GPS Technology will report its net Accounts receivable on its

December 31, 2012 balance sheet