At the end of the year, the M. I. Wright Company showed the following selected account balances:

At the end of the year, the M. I. Wright Company showed the following
selected account balances:
Sales (all on credit) ............................................................................$300,000
Accounts Receivable ......................................................................... 800,000
Allowance for Doubtful Accounts..................................................... 38,000
Required:
1. Assume the company estimates that 1% of all credit sales will not be
collected.
a. Prepare the proper journal entry to recognize the expense
involved.


Bad Debts Expense                           3,000
Allowance for Doubtful Accounts                       3,000


b. Present the balances in Accounts Receivable and Allowance for
Doubtful Accounts as they would appear on the balance sheet.
Also show the net realizable Accounts Receivable.


Accounts Receivable .................................................$800,000
Less: Allowance for Doubtful Accounts ........ 41,000
Estimated Realizable Account Receivable….$759,000