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Pearl E. White Orthodontist specializes in correcting misaligned teeth. During 2024, Pearl provides services on account of $572,000. Of this amount, $62,000 remains receivable at the end of the year. An aging schedule as of December 31, 2024, is provided below. Age Group Not yet due 0 to 90 days past due 91 to 180 days past due More than 180 days past due Total Amount Receivable $22,000 14,200 9,200 16,600 $62,000 Estimated Percent Uncollectible 5% 10% 30% 80% Required: 1. Calculate the allowance for uncollectible accounts. 2. Record the December 31, 2024, adjusting entry, assuming the balance of Allowance for Uncollectible Accounts before adjustment is $3,200 (credit). 3. On July 19, 2025, a customer's account balance of $6,200 is written off as uncollectible. Record the write-off. 4. On September 30, 2025, the customer whose account was written off in requirement 3 unexpectedly pays the full amount. Record the cash collection.

Pearl E. White Orthodontist specializes in correcting misaligned teeth. During 2024, Pearl provides services on account of $572,000. Of this amount, $62,000 remains receivable at the end of the year. An aging schedule as of December 31, 2024, is provided below. Age Group Not yet due 0 to 90 days past due 91 to 180 days past due More than 180 days past due Total Amount Receivable $22,000 14,200 9,200 16,600 $62,000 Estimated Percent Uncollectible 5% 10% 30% 80% Required: 1. Calculate the allowance for uncollectible accounts. 2. Record the December 31, 2024, adjusting entry, assuming the balance of Allowance for Uncollectible Accounts before adjustment is $3,200 (credit). 3. On July 19, 2025, a customer's account balance of $6,200 is written off as uncollectible. Record the write-off. 4. On September 30, 2025, the customer whose account was written off in requirement 3 unexpectedly pays the full amount. Record the cash collection.

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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To see companies within a particular country, either click on that country or use the search field in the upper left corner. To return to the map's global view, click on the Home icon in the upper left corner. Drawing from the data available, assess the following: 1. Identify the three countries with the most favorable collection experience as measured by their receivables turnover ratios. 2. Which country appears to have the most need for improvement in collection procedures as measured by its receivables turnover ratio? 3. Which company in Peru is most responsible for that country’s low turnover ratio? 4. IBS has established estimates for percentages of outstanding accounts receivable that are past due for the following periods of time that will be uncollectible: - 2%: 0–30 days - 5%: 31–60 days - 10%: 61–90 days - 15%: 91–120 days - 20%: >120 days Using these estimates, calculate the Allowance for Uncollectible Accounts for South Korea. Complete this question by entering your answers in the tabs below. **Required 1** Identify the three countries with the most favorable collection experience as measured by their receivables turnover ratios. (Round your answers to 2 decimal places.) | Country | Receivables Turnover Ratio | |----------------|-----------------------------| | Saudi Arabia | | | United Kingdom | | | United States | | <Tag: Required 1> <Tag: Required 2>
Transcribed Image Text:To see companies within a particular country, either click on that country or use the search field in the upper left corner. To return to the map's global view, click on the Home icon in the upper left corner. Drawing from the data available, assess the following: 1. Identify the three countries with the most favorable collection experience as measured by their receivables turnover ratios. 2. Which country appears to have the most need for improvement in collection procedures as measured by its receivables turnover ratio? 3. Which company in Peru is most responsible for that country’s low turnover ratio? 4. IBS has established estimates for percentages of outstanding accounts receivable that are past due for the following periods of time that will be uncollectible: - 2%: 0–30 days - 5%: 31–60 days - 10%: 61–90 days - 15%: 91–120 days - 20%: >120 days Using these estimates, calculate the Allowance for Uncollectible Accounts for South Korea. Complete this question by entering your answers in the tabs below. **Required 1** Identify the three countries with the most favorable collection experience as measured by their receivables turnover ratios. (Round your answers to 2 decimal places.) | Country | Receivables Turnover Ratio | |----------------|-----------------------------| | Saudi Arabia | | | United Kingdom | | | United States | | <Tag: Required 1> <Tag: Required 2>
### Pearl E. White Orthodontist: Managing Uncollectible Accounts **Scenario:** Pearl E. White Orthodontist specializes in correcting misaligned teeth. During 2024, Pearl provides services on account worth $572,000. Of this amount, $62,000 remains receivable at the end of the year. An aging schedule as of December 31, 2024, is outlined below: #### Aging Schedule: | Age Group | Amount Receivable | Estimated Percent Uncollectible | |------------------------------|-------------------|----------------------------------| | Not yet due | $22,000 | 5% | | 0 to 90 days past due | $14,200 | 10% | | 91 to 180 days past due | $9,200 | 30% | | More than 180 days past due | $16,600 | 80% | | **Total** | **$62,000** | | #### Required Tasks: 1. **Calculate the Allowance for Uncollectible Accounts:** - Determine the total amount expected to be uncollectible based on the aging schedule provided above. 2. **Record Adjusting Entry (December 31, 2024):** - Adjust the balance of the Allowance for Uncollectible Accounts, which is $3,200 before adjustment (credit). 3. **Write-Off (July 19, 2025):** - Record the write-off of a customer’s account balance of $6,200 that is deemed uncollectible. 4. **Cash Collection (September 30, 2025):** - Record the unexpected full payment from the customer whose account was written off in requirement 3. ### Instructions: Complete the question by entering your answers in the tabs provided below. - **Calculate the Allowance for Uncollectible Accounts:** - Break down each age group's receivables using the estimated uncollectible percentages to find the total allowance needed. - **Tabs:** - **Req 1:** Use this tab to calculate uncollectible amounts for each age group. - **Req 2 to 4:** Use this tab for recording adjusting entries and cash collections. This structured exercise helps manage receivables and understand how to account for uncollectible debts within a business framework.
Transcribed Image Text:### Pearl E. White Orthodontist: Managing Uncollectible Accounts **Scenario:** Pearl E. White Orthodontist specializes in correcting misaligned teeth. During 2024, Pearl provides services on account worth $572,000. Of this amount, $62,000 remains receivable at the end of the year. An aging schedule as of December 31, 2024, is outlined below: #### Aging Schedule: | Age Group | Amount Receivable | Estimated Percent Uncollectible | |------------------------------|-------------------|----------------------------------| | Not yet due | $22,000 | 5% | | 0 to 90 days past due | $14,200 | 10% | | 91 to 180 days past due | $9,200 | 30% | | More than 180 days past due | $16,600 | 80% | | **Total** | **$62,000** | | #### Required Tasks: 1. **Calculate the Allowance for Uncollectible Accounts:** - Determine the total amount expected to be uncollectible based on the aging schedule provided above. 2. **Record Adjusting Entry (December 31, 2024):** - Adjust the balance of the Allowance for Uncollectible Accounts, which is $3,200 before adjustment (credit). 3. **Write-Off (July 19, 2025):** - Record the write-off of a customer’s account balance of $6,200 that is deemed uncollectible. 4. **Cash Collection (September 30, 2025):** - Record the unexpected full payment from the customer whose account was written off in requirement 3. ### Instructions: Complete the question by entering your answers in the tabs provided below. - **Calculate the Allowance for Uncollectible Accounts:** - Break down each age group's receivables using the estimated uncollectible percentages to find the total allowance needed. - **Tabs:** - **Req 1:** Use this tab to calculate uncollectible amounts for each age group. - **Req 2 to 4:** Use this tab for recording adjusting entries and cash collections. This structured exercise helps manage receivables and understand how to account for uncollectible debts within a business framework.
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