Vaughn Inc. uses the allowance method to estimate uncollectible accounts receivable. The company produced the following aging of the accounts receivable at year-end. Calculate the total estimated bad debts based on the below information. Number of Days Outstanding Total 0–30 31–60 61–90 91–120 Over 120 Accounts receivable 331,400 104,000 70,800 65,400 49,100 $42,100 % uncollectible 2% 5% 6% 9% 21% Estimated Bad debts $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
I NEED HELP FINDING THE DOLLAR AMOUNT
Vaughn Inc. uses the allowance method to estimate uncollectible
Calculate the total estimated
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Number of Days Outstanding
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||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
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Total
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0–30
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31–60
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61–90
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91–120
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Over 120
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|||||||
| Accounts receivable | 331,400 | 104,000 | 70,800 | 65,400 | 49,100 | $42,100 | ||||||
| % uncollectible | 2% | 5% | 6% | 9% | 21% | |||||||
| Estimated Bad debts | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount |
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