expected E8-5 Stine Company has accounts receivable of $95,400 at March 31, 2014. An ana of the accounts shows these amounts. Balance, March 31 Month of Sale 2014 2013 March February December and January $65,000 12,900 10,100 7,400 $75,000 8,000 2,400 1,100 November and October $95,400 $86,500 Credit terms are 2/10, n/30. At March 31, 2014, there is a $2,100 credit balance in Allow- ance for Doubtful Accounts prior to adjustment. The company uses the percentage-of- receivables basis for estimating uncollectible accounts. The company's estimates of bad debts are as shown below. Estimated Percentage Uncollectible Age of Accounts Current 2% 1-30 days past due 31-90 days past due Over 90 days past due 30 50 Instructions (a) Determine the total estimated uncollectibles. (b) Prepare the adjusting entry at March 31, 2014, to record bad debt expense. (c) Discuss the implications of the changes in the aging schedule from 2013 to 2014.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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are expected to
ad debt expense,
the adjusting
E8-5 Stine Company has accounts receivable of $95,400 at March 31, 2014. An analys
of the accounts shows these amounts.
Balance, March 31
Month of Sale
2014
2013
March
February
December and January
November and October
$65,000
12,900
10,100
$75,000
8,000
2,400
7,400
1,100
$95,400
$86,500
Credit terms are 2/10, n/30. At March 31, 2014, there is a $2,100 credit balance in Allow-
ance for Doubtful Accounts prior to adjustment. The company uses the percentage-of-
receivables basis for estimating uncollectible accounts. The company's estimates of bad
debts are as shown below.
Estimated Percentage
Age of Accounts
Uncollectible
Current
2%
1-30 days past due
31-90 days past due
Over 90 days past due
30
50
Instructions
(a) Determine the total estimated uncollectibles.
(b) Prepare the adjusting entry at March 31, 2014, to record bad debt expense.
(c) Discuss the implications of the changes in the aging schedule from 2013 to 2014.
E8-6
On December 31 2013 when ite
entry for estimated
Transcribed Image Text:are expected to ad debt expense, the adjusting E8-5 Stine Company has accounts receivable of $95,400 at March 31, 2014. An analys of the accounts shows these amounts. Balance, March 31 Month of Sale 2014 2013 March February December and January November and October $65,000 12,900 10,100 $75,000 8,000 2,400 7,400 1,100 $95,400 $86,500 Credit terms are 2/10, n/30. At March 31, 2014, there is a $2,100 credit balance in Allow- ance for Doubtful Accounts prior to adjustment. The company uses the percentage-of- receivables basis for estimating uncollectible accounts. The company's estimates of bad debts are as shown below. Estimated Percentage Age of Accounts Uncollectible Current 2% 1-30 days past due 31-90 days past due Over 90 days past due 30 50 Instructions (a) Determine the total estimated uncollectibles. (b) Prepare the adjusting entry at March 31, 2014, to record bad debt expense. (c) Discuss the implications of the changes in the aging schedule from 2013 to 2014. E8-6 On December 31 2013 when ite entry for estimated
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