**Transcript for Educational Website****Young and Old Corporation (YOC) Uncollectible Accounts Estimation**Young and Old Corporation (YOC) uses two aging categories to estimate uncollectible accounts. Accounts less than 60 days are considered young and have a 3% uncollectible rate. Accounts more than 60 days are considered old and have a 40% uncollectible rate.**Required:**1. If YOC has $108,000 of young accounts and $480,000 of old accounts, how much should be reported in the Allowance for Doubtful Accounts?2. If YOC's Allowance for Doubtful Accounts currently has an unadjusted credit balance of $48,000, how much should be credited to the account?3. If YOC's Allowance for Doubtful Accounts has an unadjusted debit balance of $5,800, how much should be credited to the account?**Answers:**- Amount to be Reported: $195,240 ✔️- Amount to be Credited (unadjusted credit balance): $195,240 ❌- Amount to be Credited (unadjusted debit balance): $189,440 ❌(Note: An "X" indicates an incorrect answer, while a check mark indicates a correct answer.)

Allowance for doubtful accounts means the estimated amount of bad debts that will arise from…

Answered: Young and Old Corporation (YOC) uses…

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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Your company previously averaged about 20% of its total accounts receivable in the "over 90 days past due" category and now has 35% in this category. All else equal, using the aging of accounts receivable method, the amount of the bad debt adjustment will: Select one: O a. fall, increasng the ending balance of the allowance account. b. rise, increasing the ending balance of the allowance account. c. fall, decreasing the ending balance of the allowance account. d. rise, increasing the ending balance of accounts receivable.
Winstead & Company has accounts receivable of $288,000 and a negative balance of $2,400 in the Allowance for Doubtful Accounts.Two-thirds of the accounts receivable are current and one-third is past due. The firm estimates that two percent of the current accounts and five percent of the past due accounts will prove to be uncollectible.The adjustment to provide for the bad debt expense under the aging method should be for what amount?
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Williamson Distributors separates its accounts receivable into three age groups for purposes of estimating the percentage of uncollectible accounts. Accounts not yet due = $29,000; estimated uncollectible = 5%. Accounts 1 to 30 days past due = $9,900; estimated uncollectible = 15%. Accounts more than 30 days past due = $3,900; estimated uncollectible = 25%. Compute the total estimated uncollectible accounts.
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Bidiyah Co. estimates that RO 6,500 of its accounts receivable to be uncollectible. If Allowance for Doubtful Accounts has a RO 1,200 debit balance, the company should record a: Select one: O a. None of the answers are correct O b. debit to Bad Debt Expense for RO 5,300. O c credit to Allowance for Doubtful Accounts for RO 6,500. Od. debit to Allowance for Doubtful Accounts for RO 5,300. O e. credit to Bad Debt Expense for RO 7,700.
Twilight Company uses the aging of accounts recelvable method to estimate Bad Debt Expense. The balance of each account receivable is aged on the basis of three categories as follows: (1) 1-30 days old, (2) 31-90 days old, and (3) more than 90 days old. Based on experience, management has estimated what portion of recelvables of a specific age will not be paid as follows: (1) 2%, (2) 13%, and (3) 34%, respectively. At December 31, 2019, the unadjusted credit balance in the Allowance for Doubtful Accounts was $150. The total Accounts Receivable in each age category were: (1) 1-30 days old, $58,000, (2) 31-90 days old, $19,000, and (3) more than 90 days old, $3,000. Required: a. Calculate the estimate of uncollectible accounts at December 31, 2019. b. Prepare the appropriate adjusting entry dated December 31, 2019.
Casilda Company uses the aging approach to estimate bad debt expense. The ending balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, $51,300; (2) up to 180 days past due, $14,800; and (3) more than 180 days past due, $5,000. Experience has shown that for each age group, the average loss rate on the amount of the receivables at year-end due to uncollectibility is (1) 4 percent, (2) 13 percent, and (3) 31 percent, respectively. At December 31, the end of the current year, the Allowance for Doubtful Accounts balance is $100 (credit) before the end-of-period adjusting entry is made. Required: 1. Prepare the appropriate bad debt expense adjusting entry for the current year. 2. Show how the various accounts related to accounts receivable should be shown on the December 31, current year, balance sheet. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Show how the various accounts related to accounts…
Florence Company had a debit balance of $1,500 in the Allowance for Doubtful Accounts account and a debit balance of $500,000 in the Accounts Receivable account with Credit Sales of $1,500,000 for the year. Management estimates 1.5% of credit sales will become uncollectible. What is the amount of estimated bad debts expense?

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