After analyzing its accounts receivable at year-end, a company arrives at the following age categories along with the percentages estimated as uncollectible. Age of Accounts 0-30 days past due 31-60 days past due 61-120 days past due 121-180 days past due Over 180 days past due [Select] ✔ Accounts Receivable Estimated Uncollectible % Transaction Report bad debt expense $134,000 46,000 29,000 [Select] 13,000 9,000 $231,000 Assets The year-end balance of the allowance for uncollectible accounts before any adjustment is $2,300. Use the information above to answer the following questions. a. What amount of bad debt expense will the company report in its income statement for the current year? 2.0% 3.0% b. Use the financial statement effects template to show the impact of reporting this year's bad debt expense. If there is no net change in an item, select 'no net change! Balance Sheet Liabilities = 6.0% 12.0% 20.0% [Select] V Equity [Select] c. What is the net accounts receivable balance that will be reported on the year-end balance sheet? [Select] Income Statement Net Income [Select]
After analyzing its accounts receivable at year-end, a company arrives at the following age categories along with the percentages estimated as uncollectible. Age of Accounts 0-30 days past due 31-60 days past due 61-120 days past due 121-180 days past due Over 180 days past due [Select] ✔ Accounts Receivable Estimated Uncollectible % Transaction Report bad debt expense $134,000 46,000 29,000 [Select] 13,000 9,000 $231,000 Assets The year-end balance of the allowance for uncollectible accounts before any adjustment is $2,300. Use the information above to answer the following questions. a. What amount of bad debt expense will the company report in its income statement for the current year? 2.0% 3.0% b. Use the financial statement effects template to show the impact of reporting this year's bad debt expense. If there is no net change in an item, select 'no net change! Balance Sheet Liabilities = 6.0% 12.0% 20.0% [Select] V Equity [Select] c. What is the net accounts receivable balance that will be reported on the year-end balance sheet? [Select] Income Statement Net Income [Select]
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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
![After analyzing its accounts receivable at year-end, a company arrives at the following age categories along with the percentages estimated as uncollectible.
Age of Accounts
0-30 days past due
31-60 days past due
61-120 days past due
121-180 days past due
Over 180 days past due
[Select] ✔
Accounts Receivable Estimated Uncollectible %
Transaction
Report bad debt expense
$134,000
46,000
29,000
[Select]
13,000
9,000
$231,000
Assets
The year-end balance of the allowance for uncollectible accounts before any adjustment is $2,300. Use the information above to answer the following questions.
a. What amount of bad debt expense will the company report in its income statement for the current year?
2.0%
3.0%
b. Use the financial statement effects template to show the impact of reporting this year's bad debt expense. If there is no net change in an item, select 'no net change.
Balance Sheet
Liabilities
=
6.0%
12.0%
20.0%
[Select]
+
Equity
[Select]
c. What is the net accounts receivable balance that will be reported on the year-end balance sheet?
[Select]
V
Income Statement
Net Income
[Select]](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8dd902f8-6431-45e1-964f-aabc90f93bf5%2F428759c7-427f-48ae-a412-f10b5632456b%2Fi6y8cv_processed.png&w=3840&q=75)
Transcribed Image Text:After analyzing its accounts receivable at year-end, a company arrives at the following age categories along with the percentages estimated as uncollectible.
Age of Accounts
0-30 days past due
31-60 days past due
61-120 days past due
121-180 days past due
Over 180 days past due
[Select] ✔
Accounts Receivable Estimated Uncollectible %
Transaction
Report bad debt expense
$134,000
46,000
29,000
[Select]
13,000
9,000
$231,000
Assets
The year-end balance of the allowance for uncollectible accounts before any adjustment is $2,300. Use the information above to answer the following questions.
a. What amount of bad debt expense will the company report in its income statement for the current year?
2.0%
3.0%
b. Use the financial statement effects template to show the impact of reporting this year's bad debt expense. If there is no net change in an item, select 'no net change.
Balance Sheet
Liabilities
=
6.0%
12.0%
20.0%
[Select]
+
Equity
[Select]
c. What is the net accounts receivable balance that will be reported on the year-end balance sheet?
[Select]
V
Income Statement
Net Income
[Select]
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