Marigold Corporation operates in an industry that has a high rate of bad debts. Before any year-end adjustments, the balance in Marigold's Accounts Receivable account was $588,400 and Allowance for Doubtful Accounts had a credit balance of $43.590. The year-end balance reported in the balance sheet for Allowance for Doubtful Accounts will be based on the aging schedule shown below. Days Account Outstanding Less than 16 days Between 16 and 30 days Between 31 and 45 days Between 46 and 60 days Between 61 and 75 days Over 75 days (to be written off) Amount $317.700 113,000 82,100 41.600 18.500 15,500 Probability of Collection 0.97 0.90 0.86 0.81 0.51 0.00

Marigold Corporation operates in an industry that has a high rate of bad debts. Before any year-end adjustments, the balance in Marigold's Accounts Receivable account was $588,400 and Allowance for Doubtful Accounts had a credit balance of $43.590. The year-end balance reported in the balance sheet for Allowance for Doubtful Accounts will be based on the aging schedule shown below. Days Account Outstanding Less than 16 days Between 16 and 30 days Between 31 and 45 days Between 46 and 60 days Between 61 and 75 days Over 75 days (to be written off) Amount $317.700 113,000 82,100 41.600 18.500 15,500 Probability of Collection 0.97 0.90 0.86 0.81 0.51 0.00

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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