Horus Company provided for doubtful accounts expense monthly at 3%of credit sales. The balance in the allowance for doubtful accounts was P1,000,000 on January 1 , 2019. During 2019, credit sales totaled P20,000,000, interim provisions for doubtful accounts were made at 3% of credit sales, P200,000 accounts were written off, and recoveries of accounts previously written off amounted to P50,000. An aging of accounts receivable was made on December 31, 2019. 1 – 60 days 6,000,000 10% uncollectible 61 – 180 days 2,000,000 20% uncollectible 181 – 360 days 1,500,000 30% uncollectible More than one year 500,000 50% uncollectible 10,000,000 Based on the preview of the “more than one year” category, additional accounts of P100,000 are to be written off on December 31, 2019. What is the year-end adjustment to the allowance for doubtful accounts on December 31,2019?
Horus Company provided for doubtful accounts expense monthly at 3%of credit sales. The balance in the allowance for doubtful accounts was P1,000,000 on January 1 , 2019.
During 2019, credit sales totaled P20,000,000, interim provisions for doubtful accounts were made at 3% of credit sales, P200,000 accounts were written off, and recoveries of accounts previously written off amounted to P50,000.
An aging of
1 – 60 days 6,000,000 10% uncollectible
61 – 180 days 2,000,000 20% uncollectible
181 – 360 days 1,500,000 30% uncollectible
More than one year 500,000 50% uncollectible
10,000,000
Based on the preview of the “more than one year” category, additional accounts of P100,000 are to be written off on December 31, 2019.
- What is the year-end adjustment to the allowance for doubtful accounts on December 31,2019?
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