1. The September 30, 2015 records of Fogleman Communications (“FC”) included the following:

            Accounts Receivable                           $462,000

            Allowance for doubtful Accounts      ($15,300)

During the year FC estimated doubtful accounts expense at 1% of credit sales. At year end, FC ages its accounts receivable and adjusts the balances in Allowance for Doubtful Accounts to correspond to the aging schedule.

                                                Age of Accounts

Accounts Rec.                         1-30 Days       31-60 Days     61-90 Days     Over 90 Days

$438,000                                 $255,000         $78,000           $26,000           $79,000

Est. % of Uncollectible           0.3%                3.0%                12.0%              25.0%

During the last quarter of 2015, the company completed the following selected transactions:

Nov.30 Wrote-off as uncollectible the $2,500 account receivable from Frisco carpets and the $900 account receivable from Antiques on the Avenue.

Dec. 31  Adjusted the Allowance for Doubtful Accounts and recorded doubtful-account expense at year-end, based on the aging of receivables.

a) Record the transactions for the last quarter of 2015 in the journal. Explanations not required.

b) Prepare an aging schedule. Prepare T-accounts for Accounts Receivable and Allowance for Doubtful Accounts with the appropriate beginning balance. Post the entries from requirement 1 to that account.

c) Show how FC will report its accounts receivable in a comparative balance sheet for 2015 and 2014. Use the three-line reporting format. At December 31, 2014, the company’s accounts receivables was $432,000 and the Allowance for doubtful Accounts stood at $47,300.