The following information pertains to Eire Co.’s accounts receivable at December 31, Year 2: Days Estimated Outstanding Amount % Uncollectible 0 - 60 $240,000 1% 61 - 120 180,000 2% Over 120 200,000 6% $620,000 During Year 2, Eire wrote off $14,000 in receivables and recovered $8,000 that was written off in prior years. Its December 31, Year 1, allowance for credit losses was $44,000. Under the aging method, what amount of allowance for credit losses should Eire report at December 31, Year 2?
The following information pertains to Eire Co.’s accounts receivable at December 31, Year 2: Days Estimated Outstanding Amount % Uncollectible 0 - 60 $240,000 1% 61 - 120 180,000 2% Over 120 200,000 6% $620,000 During Year 2, Eire wrote off $14,000 in receivables and recovered $8,000 that was written off in prior years. Its December 31, Year 1, allowance for credit losses was $44,000. Under the aging method, what amount of allowance for credit losses should Eire report at December 31, Year 2?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 12E: Inferring Accounts Receivable Amounts At the end of 2019, Karras Inc. had a debit balance of 141,120...
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Question
The following information pertains to Eire Co.’s accounts receivable at December 31, Year 2:
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Days
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Estimated
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Outstanding
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Amount
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% Uncollectible
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0 - 60
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$240,000
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1%
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61 - 120
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180,000
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2%
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Over 120
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200,000
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6%
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|||
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|||
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$620,000
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During Year 2, Eire wrote off $14,000 in receivables and recovered $8,000 that was written off in prior years. Its December 31, Year 1, allowance for credit losses was $44,000. Under the aging method, what amount of allowance for credit losses should Eire report at December 31, Year 2?
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