Exercise 7-16 (Algo) Aging of Receivables Schedule LO P3 Following is a list of credit customers along with their amounts owed and the days past due at December 31. Also shown are five classifications of accounts receivable and estimated bad debts percent for each class. Percent uncollectible Accounts 1 to 30 38 Days Past Due 31 to 60 58 61 to 90 88 Over 90 129 Customer BCC Company Lannister Company Mike Properties Ted Reeves Jen Steffens Receivable Days Past Due $ 5,400 11 2,400 0 6,400 106 1,200 3,400 80 42 1. Create an aging of accounts receivable schedule of accounts receivable by age similar to the table given above. Calculate the estimated balance for the Allowance for Doubtful Accounts. 2. Assuming an unadjusted credit balance of $240, record the required adjustment to the Allowance for Doubtful Accounts. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Create an aging of accounts receivable schedule of accounts receivable by age similar to the table given above. Calculate the estimated balance for the Allowance for Doubtful Accounts. Estimated balance for Allowance for Doubtful Accounts

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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.