Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year. Bad Debt Expense: Aging MethodGlencoe Supply had the following accounts receivable aging schedule at the end of a recent year.AccountsProportion ExpectedAllowanceReceivable AgeAmountto DefaultRequiredCurrent$310,5000.005$1,5531-30 days past due47,5000.0147531-45 days past due25,0000.133,25046-90 days past due12,8000.202,56091-135 days past due6,1000.251,525Over 135 days past due4,2000.602,520$11,883The balance in Glencoe allowance for doubtful accounts at the beginning of the year was $47,600 (credit). During the year, accounts in the total amount of $51,232 were written off.Required:1. Determine bad debt expense.$ 15,663 xFeedback2. Prepare the journal entry to record bad debt expense. If an amount box does not require an entry, leave it blank.Bad Debt Expense15,663 xAllowance for Doubtful Accounts15,663 X(Record adjusting entry for bad debt expense estimate)Feedback3. If Glencoe had written off $92,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed?27,600 x

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Description: Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year. Bad Debt Expense: Aging MethodGlencoe Supply had the following accounts receivable aging schedule at the end of a recent y

The factors that contribute to bad debts are- If the debtor becomes bankrupt When the collect cost…

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Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 68E: Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule...

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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.

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Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year.

Definition Definition Receivable amount that a company is owed, but did not receive, and which may not be receivable in future.

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Tines Commerce computes bad debt based on the allowance method. They determine their current years balance estimation to be a credit of $45,000. The previous period had a credit balance in Allowance for Doubtful Accounts of $12,000. What should be the reported figure in the adjusting entry for the current period? A. $12,000 B. $45,000 C. $33,000 D. $57,000
Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year. AccountsReceivable Age Amount Proportion Expectedto Default AllowanceRequired Current $310,500 0.005 $1,553 1–30 days past due 47,500 0.01 475 31–45 days past due 25,000 0.13 3,250 46–90 days past due 12,800 0.20 2,560 91–135 days past due 6,100 0.25 1,525 Over 135 days past due 4,200 0.60 2,520 $11,883 The balance in Glencoe's allowance for doubtful accounts at the beginning of the year was $58,620 (credit). During the year, accounts in the total amount of $62,400 were written off. Required: 1. Determine bad debt expense. 2. Prepare the journal entry to record bad debt expense. If an amount box does not require an entry, leave it blank. - Select - - Select - - Select - - Select - (Record adjusting entry for bad debt expense estimate) 3.…
Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year. Accounts Receivable AgeAmount Proportion Expectedto Default AllowanceRequired Current $310,500 0.005 $1,553 1–30 days past due 47,500 0.01 475 31–45 days past due 25,000 0.13 3,250 46–90 days past due 12,800 0.20 2,560 91–135 days past due 6,100 0.25 1,525 Over 135 days past due 4,200 0.60 2,520 $11,883 The balance in Glencoe's allowance for doubtful accounts at the beginning of the year was $58,620 (credit). During the year, accounts in the total amount of $62,400 were written off. Required: 1. Determine bad debt expense.$ 2. Prepare the journal entry to record bad debt expense. (Record adjusting entry for bad debt expense estimate) 3. By how much would bad debt expense reported on the statement of earnings have changed if Glencoe…
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Recording and Reporting a Bad Debt Estimate Using Aging Analysis E14-13 Chou Company uses the aging approach to estimate bad debt expense. The ending balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, $295,000; (2) up to 120 days past due, $55,000; and (3) more than 120 days past due, $18,000. Experience has shown that for each age group, the average loss rate on the amount of the receivables at year-end due to uncollectibility is (1) 2.5 percent, (2) 11 percent, and (3) 30 percent, respectively. At December 31, the end of the current year, the Allowance for Doubtful Accounts balance is $100 (credit) before the end-of-period adjusting entry is made. Required: Prepare the appropriate bad debt expense adjusting entry for the current year. Show how the various accounts related to accounts receivable should be shown on the December 31, current year, balance sheet.
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