Chapter 7, Problem 7.1P

1.

To determine

Aging of receivables method:

A method of determining the estimated uncollectible receivables, based on the age of individual accounts receivable is known as aging of receivables method.

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

To prepare: A summary journal entry to record the Monthly bad debts expense and the write-offs during the year.

2.

To determine

To prepare:   The necessary year-end adjusting entry for bad debts expense.

3.

To determine

To compute: The bad debts expense for 2016.