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Drew Incorporated provides legal services

Accounting

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Drew Incorporated provides legal services. During 2021, the company provides services of $500,000 on account. Of this amount, $70,000 remains uncollected at the end of the year. An aging schedule as of December 31, 2021, is provided below.

 

Age Group

Amount Receivable

Estimated Percent Uncollectible

Not yet due

$40,000

5%

0-30 days past due

19,000

10%

31-60 days past due

9,000

20%

More than 60 days past due

   6,000

40%

Total

$74,000

 

 

Required:

 

1. Calculate the allowance for uncollectible accounts.
2. Record the December 31, 2021 adjustment, assuming the balance of Allowance for Uncollectible Accounts before adjustment is $500 (debit).