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Pachel Corporation reports the following information pertaining to its accounts receivable. Days Past Due 31-60 $25,000 Current 1-30 61-90 $40,000 Over 90 $2,000 $60,000 $12,000 The company's credit department provided the following estimates regarding the percent written off from each category listed. Current receivables outstanding Receivables 1-30 days past due Receivables 31-68a days nast due 2% 4

Pachel Corporation reports the following information pertaining to its accounts receivable. Days Past Due 31-60 $25,000 Current 1-30 61-90 $40,000 Over 90 $2,000 $60,000 $12,000 The company's credit department provided the following estimates regarding the percent written off from each category listed. Current receivables outstanding Receivables 1-30 days past due Receivables 31-68a days nast due 2% 4

FINANCIAL ACCOUNTING
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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ACCT 102 - Please Do Both Subparts.

Pachel Corporation reports the following information pertaining to its accounts receivable. Days Past Due Current 1-30 31-60 61-90 Over 90 $60,000 $40,000 $25,000 $12,000 $2,000 The company's credit department provided the following estimates regarding the percent of accounts expected to eventually be written off from each category listed. Current receivables outstanding Receivables 1-30 days past due Receivables 31-60 days past due Receivables 61-90 days past due Receivables over 90 days past due 2% 4 16 40 90 The company uses a balance sheet approach to estimate credit losses. a. Record the company's uncollectible accounts expense, assuming it has a $1,400 credit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. b. Without regard to your answer to part a, record the company's uncollectible accounts expense, assuming it has a $1,600 debit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. Complete this question by entering your answers in the table below. Reared A Required B Record the company's uncollectible accounts expense, assuming it has a $1,400 credit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet
Transcribed Image Text:Pachel Corporation reports the following information pertaining to its accounts receivable. Days Past Due Current 1-30 31-60 61-90 Over 90 $60,000 $40,000 $25,000 $12,000 $2,000 The company's credit department provided the following estimates regarding the percent of accounts expected to eventually be written off from each category listed. Current receivables outstanding Receivables 1-30 days past due Receivables 31-60 days past due Receivables 61-90 days past due Receivables over 90 days past due 2% 4 16 40 90 The company uses a balance sheet approach to estimate credit losses. a. Record the company's uncollectible accounts expense, assuming it has a $1,400 credit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. b. Without regard to your answer to part a, record the company's uncollectible accounts expense, assuming it has a $1,600 debit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. Complete this question by entering your answers in the table below. Reared A Required B Record the company's uncollectible accounts expense, assuming it has a $1,400 credit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet
prior to making account field.) View transaction list Journal entry worksheet 1 Record the entry for uncollectible accounts expense if there is a credit balance in the Allowance for Doubtful Accounts. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Record entry Clear entry View general journal Required B
Transcribed Image Text:prior to making account field.) View transaction list Journal entry worksheet 1 Record the entry for uncollectible accounts expense if there is a credit balance in the Allowance for Doubtful Accounts. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Record entry Clear entry View general journal Required B
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