Determine the number of days past due for each of the preceding accounts as of November 30
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.
Aging of Receivables Schedule
The
| Not | Days Past Due | |||||||||||
| Past | Over | |||||||||||
| Customer | Balance | Due | 1-30 | 31-60 | 61-90 | 90 | ||||||
| Academy Industries Inc. | 5,500 | 5,500 | ||||||||||
| Ascent Company | 4,500 | 4,500 | ||||||||||
| Zoot Company | 9,800 | 9,800 | ||||||||||
| Subtotals | 784,200 | 473,700 | 172,500 | 75,300 | 39,200 | 23,500 |
The following accounts were unintentionally omitted from the aging schedule and not included in the subtotals above:
| Customer | Balance | Due Date | |
| Conover Industries | $11,000 | July 9 | |
| Keystone Company | 7,800 | September 20 | |
| Moxie Creek Inc. | 15,700 | October 16 | |
| Rainbow Company | 9,400 | November 5 | |
| Swanson Company | 21,200 | December 21 |
a. Determine the number of days past due for each of the preceding accounts as of November 30. If an account is not past due, enter 0.
| Customer | Due Date | Number of Days Past Due |
| Conover Industries | July 9 | |
| Keystone Company | September 20 | |
| Moxie Creek Inc. | October 16 | |
| Rainbow Company | November 5 | |
| Swanson Company | December 21 |
b. Complete the aging-of-receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals. If an amount box does not require an entry, leave it blank.
| Kirchhoff Industries | ||||||
| Aging of Receivables Schedule | ||||||
| November 30 | ||||||
| Customer | Balance | Not Past Due | Days Past Due 1-30 | Days Past Due 31-60 | Days Past Due 61-90 | Days Past Due Over 90 |
| Academy Industries Inc. | 5,500 | 5,500 | ||||
| Ascent Company | 4,500 | 4,500 | ||||
| Zoot Company | 9,800 | 9,800 | ||||
| Subtotals | 784,200 | 473,700 | 172,500 | 75,300 | 39,200 | 23,500 |
| Conover Industries | ||||||
| Keystone Company | ||||||
| Moxie Creek Inc. | ||||||
| Rainbow Company | ||||||
| Swanson Company | ||||||
| Totals |
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