The company estimates future uncollectible accounts. The company determines $14,000 of accounts receivable on January 31 are past due, and 30% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.) Record bad debts at the end of January.

Bad debt expense = $4,690

Explanation:

Entry                                                 DEBIT       CREDIT

Bad debt Expense                         $4,690

Allowance for doubtful debt                           $4,690

In Order to record bad debt expense, we need to go through some minor workings.

Workings

Receivables on January 31  past due =  $14,000 x 30% = $4,200

Receivable not past due = ($14,000 x 70%) x5% = $490

Bad debt expense = Receivables on January 31  past due + Receivable not past due

Bad debt expense = $4,200 + $490

Bad debt expense = $4,690

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forbearance of student loan payments. under forbearance, your loan payments are postponed (or reduced) but interest continues to accrue during the period of forbearance. if you don't pay the interest during that period, the interest may be “capitalized,” which means it is added to your principal balance.