The accounts receivable subsidiary ledger of Olarita Corporation shows the following information: Customer 12/31 Account balance Invoice Date Amount One, Inc. P140,720 12/06 P56,000 11/29 84,720 Two Co. 83,680 09/02 48,000 08/20 35,680 Three Corp. 122,400 12/08 80,000 10/25 42,400 Four Co. 180,560 11/17 92,560 10/09 88,000 Five Co. 126,400 12/12 76,800 12/02 49,600 Six, Inc. 69,600 09/12 69,600 Total P723,360 P723,360 The estimated bad debt rates below are based on the Corporation’s receivable collection experience. Age of accounts Rate 0 – 30 days 1% 31 – 60 days 1.5% 61 – 90 days 3% 91 – 120 days 10% Over 120 days 50% The Allowance for Doubtful Accounts had a credit balance of P14,000 on December 31, 2020, before adjustment. 1. The adjusting journal entry to adjust the allowance for doubtful accounts as of December 31, 2020 will include a debit to doubtful accounts expense of
The
Customer 12/31 Account balance Invoice Date Amount
One, Inc. P140,720 12/06 P56,000 11/29 84,720
Two Co. 83,680 09/02 48,000 08/20 35,680
Three Corp. 122,400 12/08 80,000 10/25 42,400
Four Co. 180,560 11/17 92,560 10/09 88,000
Five Co. 126,400 12/12 76,800 12/02 49,600
Six, Inc. 69,600 09/12 69,600 Total P723,360 P723,360
The estimated
Age of accounts Rate
0 – 30 days 1%
31 – 60 days 1.5%
61 – 90 days 3%
91 – 120 days 10%
Over 120 days 50%
The Allowance for Doubtful Accounts had a credit balance of P14,000 on December 31, 2020, before adjustment.
1. The
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