1) Accounting for uncollectible accounts using the allowance method (aging-of- receivables) and reporting receivables on the balance sheet. () At September 30, 2018, the accounts of Roxbury Medical Center (RMC) include the following: Accounts Receivable $154,000 Allowance for Bad Debts (credit 3,700 balance) During the last quarter of 2018, RMC completed the following selected transactions: Sales on account, $465,000. Ignore Cost of Goods Sold. • Collections on account, $441,800. Wrote off accounts receivable as uncollectible: Jenkins, Co., $1,900; Sony, $800; and Smith, Inc., $500 Recorded bad debts expense based on the aging of accounts receivable, as follows: Age of Accounts 1-30 Days $ 97,000 Accounts Receivable Estimated percent 0.2% uncollectible 31-60 Days $37,000 3.5% 61-90 Days $17,000 29% Over 90 Days $ 14,000 32%
1) Accounting for uncollectible accounts using the allowance method (aging-of- receivables) and reporting receivables on the balance sheet. () At September 30, 2018, the accounts of Roxbury Medical Center (RMC) include the following: Accounts Receivable $154,000 Allowance for Bad Debts (credit 3,700 balance) During the last quarter of 2018, RMC completed the following selected transactions: Sales on account, $465,000. Ignore Cost of Goods Sold. • Collections on account, $441,800. Wrote off accounts receivable as uncollectible: Jenkins, Co., $1,900; Sony, $800; and Smith, Inc., $500 Recorded bad debts expense based on the aging of accounts receivable, as follows: Age of Accounts 1-30 Days $ 97,000 Accounts Receivable Estimated percent 0.2% uncollectible 31-60 Days $37,000 3.5% 61-90 Days $17,000 29% Over 90 Days $ 14,000 32%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
Please correct Solution with Explanation and do not give image format
Transcribed Image Text:Requirements
1. Open T-accounts for Accounts Receivable and Allowance for Bad Debts. Journalize
the transactions (omit explanations) and post to the two accounts.
2. Show how Roxbury Medical Center should report net accounts receivable on its
December 31, 2018, balance sheet.
SOLUTION
Requirement 1
Date Account and Explanation
Debit
Credit
Transcribed Image Text:1) Accounting for uncollectible accounts using the allowance method (aging-of-
receivables) and reporting receivables on the balance sheet. ()
At September 30, 2018, the accounts of Roxbury Medical Center (RMC) include the
following:
Accounts Receivable
$154,000
Allowance for Bad Debts (credit 3,700
balance)
During the last quarter of 2018, RMC completed the following selected transactions:
Sales on account, $465,000. Ignore Cost of Goods Sold.
• Collections on account, $441,800.
Wrote off accounts receivable as uncollectible: Jenkins, Co., $1,900;
Sony, $800; and Smith, Inc., $500
Recorded bad debts expense based on the aging of accounts
receivable, as follows:
Accounts
Receivable
Estimated percent
uncollectible
Age of Accounts
1-30
Days
$ 97,000
0.2%
31-60
Days
$37,000
3.5%
61-90
Days
$ 17,000
29%
Over 90
Days
$ 14,000
32%
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