At the end of the first year of operations, Gaur Manufacturing had gross accounts receivable of $300,000. Gaur's management estimates that 6% of the accounts will prove uncollectible.

 At the end of the first year of operations, Gaur Manufacturing had gross accounts receivable of $300,000. Gaur's management estimates that 6% of the accounts will prove uncollectible.

What journal entry should Gaur record to establish an allowance for uncollectible accounts?

 

Explanation

Allowance for uncollectible accounts = $300,000 × 6% = 18,000

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