Novak Corp. has accounts receivable of $90,300 at March 31, 2017. Credit terms are 2/10, n/30. At March 31, 2017, there is a $2,284 credit balance in Allowance 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. Balance, March 31 Estimated PercentageUncollectible Age of Accounts 2017 2016 Current $61,700 $74,140 2 % 1–30 days past due 12,600 8,520 5 31–90 days past due 9,200 2,260 28 Over 90 days past due 6,800 1,160 49 $90,300 $86,080 Determine the total estimated uncollectibles. The total estimated uncollectibles $Enter a dollar amount Prepare the adjusting entry at March 31, 2017, to record bad debt expense. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Enter an account title Enter a debit amount Enter a credit amount Enter an account title Enter a debit amount Enter a credit amount

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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Novak Corp. has accounts receivable of $90,300 at March 31, 2017. Credit terms are 2/10, n/30. At March 31, 2017, there is a $2,284 credit balance in Allowance 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.

	Balance, March 31	Estimated Percentage Uncollectible
Age of Accounts	2017	2016
Current	$61,700	$74,140	2	%
1–30 days past due	12,600	8,520	5
31–90 days past due	9,200	2,260	28
Over 90 days past due	6,800	1,160	49
	$90,300	$86,080

Determine the total estimated uncollectibles.

The total estimated uncollectibles

$Enter a dollar amount

Prepare the adjusting entry at March 31, 2017, to record bad debt expense. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit
Enter an account title	Enter a debit amount	Enter a credit amount
Enter an account title	Enter a debit amount	Enter a credit amount

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