ECEIVABLE 393 Not yet due 1-30 days past due 31-60 days past due 61-90 days past due Over 90 days past due. Total accounts receivable. $348,000 180,000 78,000 -18,000 30,000 $654,000 In reliance upon its past experience with collections, the company estimated the percentages probably uncollectible for the above five age groups to be as fol- Jows: Group 1, 1%; Group 2, 4%; Group 3, 10%; Group 4, 30%; and Group 5, 50%. Prior to adjustment at December 31, the Allowance for Doubtful Accounts showed a credit balance of $12,600. a Compute the estimated amount of uncollectible accounts based on the above classification by age groups. b Prepare the adjusting entry needed to bring the Allowance for Doubtful Ac- counts to the proper amount. c Assume that on February 2 of the following year, Chandler Associates learned that an account receivablé which had originated on October 6 in the amount of $7,200 was worthless because of the bankruptcy of the customer, Weaver Com- pany. Prepare the jour:al entry required on February 2 to write off this account receivable.

ECEIVABLE 393 Not yet due 1-30 days past due 31-60 days past due 61-90 days past due Over 90 days past due. Total accounts receivable. $348,000 180,000 78,000 -18,000 30,000 $654,000 In reliance upon its past experience with collections, the company estimated the percentages probably uncollectible for the above five age groups to be as fol- Jows: Group 1, 1%; Group 2, 4%; Group 3, 10%; Group 4, 30%; and Group 5, 50%. Prior to adjustment at December 31, the Allowance for Doubtful Accounts showed a credit balance of $12,600. a Compute the estimated amount of uncollectible accounts based on the above classification by age groups. b Prepare the adjusting entry needed to bring the Allowance for Doubtful Ac- counts to the proper amount. c Assume that on February 2 of the following year, Chandler Associates learned that an account receivablé which had originated on October 6 in the amount of $7,200 was worthless because of the bankruptcy of the customer, Weaver Com- pany. Prepare the jour:al entry required on February 2 to write off this account receivable.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Use the following to answer questions 8 – 11 The following information pertains to RC, Inc. for the month of December: Credit sales $900,000 Accounts payable 38,500 Accounts receivable 55,400 Allowance for Uncollectible accounts 400 credit Cash sales 300,000 RC uses the percent of receivables method and estimates it will not collect 5% of accounts receivable. 8. $ Determine the ending balance for the Allowance for Uncollectible Accounts Determine the appropriate amount $ to record for Bad Debt expense 9. _Assuming the Allowance for Uncollectible accounts had a $700 debit balance, determine the amount to record for Bad Debt expense 10. $ 11. $ After recording bad debt expense, the Net Accounts Receivable is:
Daley Company prepared the following aging of receivables analysis at December 31. Total 0 Accounts receivable Percent uncollectible $ 625,000 $ 407,000 1 to 30 $ 101,000 Days Past Due 31 to 60 $ 47,000 61 to 90 $ 29,000 Over 90 $ 41,000 3% 4% 7% 9% 12% a. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 5% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method. b. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $13,100 credit. c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $2,100 debit. Answer is not complete. Complete this question by entering your answers in the tabs below. Req A Req B and C Estimate the balance of the Allowance for Doubtful Accounts assuming the company…
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Question: Young and Old Corporation (YOC) uses two aging categories to estimate uncollectible accounts. Accounts less than 60 days are considered young and have a 4% uncollectible rate. Accounts more than 60 days are considered old and have a 35% uncollectible rate old If YOC has $107,000 of young accounts and $470,000 of accounts, how much should reported in the Allowance for Doubtful Accounts? Amount to reported? be be
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Question Content Area Estimating Allowance for Doubtful Accounts Kirchhoff Industries has a past history of uncollectible accounts, as shown below. Age Class PercentUncollectible Not past due 1% 1-30 days past due 5 31-60 days past due 25 61-90 days past due 35 Over 90 days past due 50 Estimate the allowance for doubtful accounts, based on the aging of receivables schedule below. Kirchhoff IndustriesAging of Receivables Scheduleblank Customer Balance Not PastDue 1-30 DaysPast Due 31-60 DaysPast Due 61-90 DaysPast Due Over 90 DaysPast Due Subtotals 840,000 495,600 184,800 75,600 42,000 42,000 Conover Industries 18,100 18,100 Keystone Company 18,200 18,200 Moxie Creek Inc. 6,600 6,600 Rainbow Company 10,000 10,000 Swanson Company 23,100 23,100 Total receivables 916,000 518,700 194,800 82,200 60,200 60,100 Percentage uncollectible 1% 5% 25% 35% 50% Allowance for Doubtful…
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