Accounting for uncollectible accounts using the allowance method and reporting receivables on the balance sheet.

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

1-30 Days

31-60 Days

61-90 Days

Over 90 Days

Accounts Receivable 190,000

80,000

60,000

40,000

10,000

Estimated percent uncollectible

0.4%

5.0%

6.0%

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.