Estimating Uncollectible Accounts and Reporting Accounts Receivable LaFond Company analyzes its accounts receivable at December 31, and arrives at the age categories below along with the percentages that are estimated as uncollectible. Age Group Accounts Receivable Estimated Loss % 0-30 days past due $ 180,000 1% 31-60 days past due 40,000 2 61-120 days past due 22,000 5 121-180 12,000 10 Over 180 days past due 8,000 25 Total accounts receivable $ 262,000 (b) Use the financial statement effects template to record LaFond's bad debts expense for the year. Use negative signs with your answers, when appropriate
Estimating Uncollectible Accounts and Reporting Accounts Receivable LaFond Company analyzes its accounts receivable at December 31, and arrives at the age categories below along with the percentages that are estimated as uncollectible. Age Group Accounts Receivable Estimated Loss % 0-30 days past due $ 180,000 1% 31-60 days past due 40,000 2 61-120 days past due 22,000 5 121-180 12,000 10 Over 180 days past due 8,000 25 Total accounts receivable $ 262,000 (b) Use the financial statement effects template to record LaFond's bad debts expense for the year. Use negative signs with your answers, when appropriate
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Estimating Uncollectible Accounts and Reporting
LaFond Company analyzes its accounts receivable at December 31, and arrives at the age categories below along with the percentages that are estimated as uncollectible.
|
Age Group |
Accounts Receivable |
Estimated Loss % |
|---|---|---|
| 0-30 days past due | $ 180,000 | 1% |
| 31-60 days past due | 40,000 | 2 |
| 61-120 days past due | 22,000 | 5 |
| 121-180 | 12,000 | 10 |
| Over 180 days past due | 8,000 | 25 |
| Total accounts receivable | $ 262,000 |
(b) Use the financial statement effects template to record LaFond's
Use negative signs with your answers, when appropriate.
|
Balance Sheet
|
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Transaction | Cash Asset | + |
Noncash Assets |
= | Liabilities | + |
Contributed Capital |
+ |
Earned Capital |
|
| Record bad debts expense |
|
|
|
|
|
|
Income Statement
|
||||
|---|---|---|---|---|
Revenue |
- |
Expenses |
= |
Net Income |
|
|
|
|
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