Fundamental Accounting Principles 22th Edition by John Wild ,Ken Shaw,Barbara Chiappetta

Exercise 53

Hitachi, Ltd. , reports total revenues of ¥9,041,071 million for its fiscal year ending March 31, 2013, and its March 31, 2013, unadjusted trial balance reports a debit balance for trade receivables (gross) of ¥2,500,000 million.
a. Prepare the adjusting entry to record its bad debts expense assuming uncollectibles are estimated to be 0.4% of total revenues and its unadjusted trial balance reports a credit balance of ¥10,000 million for the allowance for doubtful accounts.
b. Prepare the adjusting entry to record bad debts expense assuming uncollectibles are estimated to be 2.0% of year-end trade receivables (gross) and its unadjusted trial balance reports a credit balance of ¥10,000 million for the allowance for doubtful accounts.