Fundamental Accounting Principles
23rd Edition
ISBN: 9781259536359
Author: John J Wild, Ken Shaw Accounting Professor, Barbara Chiappetta Fundamental Accounting Principles
Publisher: McGraw-Hill Education
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Chapter 9, Problem 3APSA
Problem 9-3A
Aging
P2 P3
Jarden Company has credit sales of $3,600,000 for year 2017. On December 31, 2017, the company’s Allowance for Doubtful Accounts has an unadjusted credit balance of $14,500. Jarden prepares a schedule of its December 31, 2017, accounts receivable by age. On the basis of past experience, it estimates the percent of receivables in each age category that will become uncollectible. This information is summarized here.
Required
- Estimate the required balance of the Allowance for Doubtful Accounts at December 31, 2017, using the aging of accounts receivable method.
- Prepare the
adjusting entry to record bad debts expense at December 31, 2017.
Check (2) Dr. Bad Debts Expense, $27,150
Analysis Component
- 3. On June 30, 2018, Jarden Company concludes that a customer’s $4,750 receivable (created in 2017) is uncollectible and that the account should be written off. What effect will this action have on Jarden’s 2018 net income? Explain.
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Problems
1. For the year ended December 31, 2017, Casey Company estimated its allowance for
uncollectible accounts using the year-end aging of accounts receivable. The following
data are available:
Allowance for uncollectible accounts, 1/1/17
800,000
Provision for uncollectible accounts during 2017
(2% on credit sales of P20,000,000)
400,000
Uncollectible accounts written off, 11/30/17
300,000
Recovery of accounts considered worthless
Estimated uncollectible accounts per aging, 12/31/17
100,000
1,150,000
After year-end adjustment, the uncollectible accounts expense for 2017 should be
а. 300,000
b. 600,000
150,000
d. 550,000
С.
Exercise 8-5
Waterway Industries has accounts receivable of $98,600 at March 31, 2017. Credit terms are 2/10, n/30. At March 31, 2017, there is a $2,227 credit balance in Allowance for Doubtful Accounts prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The company’s estimates of bad debts are as shown below.
Balance, March 31
Estimated PercentageUncollectible
Age of Accounts
2017
2016
Current
$68,400
$69,990
2
%
1–30 days past due
13,700
7,880
5
31–90 days past due
9,700
2,400
28
Over 90 days past due
6,800
1,100
49
$98,600
$81,370
Determine the total estimated uncollectibles.
The total estimated uncollectibles
$
Prepare the adjusting entry at March 31, 2017, to record bad debt expense. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Question 8
Dreadful Behaviour Ltd has credit sales of $400,000 in 2022 and a debit balance of $1,900 in the
Allowance for Doubtful Accounts at year end. As of December 31, 2022, $120,000 of accounts
receivable remain uncollected. The credit manager of Dangle prepared an aging schedule of accounts
abnor receivable and estimates that $4,800 will prove to be uncollectible.
On March 3, 2023 the credit manager authorizes a write-off of the $1,000 balance owed by D. Taylor.
On April 1, 2023 Mr. Taylor pays his account in full and also pays Dangle $75 interest on his account
Required
(a) Prepare the adjusting entry to record the estimated uncollectible accounts expense in 2022.
(b) Show the statement of financial position presentation of accounts receivable on December 31, 2022.
(c) On March 3, 2023 before the write-off, assume the balance of Accounts Receivable account is
$160,000 and the balance of Allowance for Doubtful Accounts is a credit of $3,000. Make the
appropriate entry to record…
Chapter 9 Solutions
Fundamental Accounting Principles
Ch. 9 - Prob. 1DQCh. 9 - Why does the direct write-off method of accounting...Ch. 9 - Prob. 3DQCh. 9 - Why might a business prefer a note receivable to...Ch. 9 - Prob. 5DQCh. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Prob. 9DQCh. 9 - Prob. 10DQ
Ch. 9 - Prob. 1QSCh. 9 - Prob. 2QSCh. 9 - Prob. 3QSCh. 9 - Distinguishing between allowance method and direct...Ch. 9 - Prob. 5QSCh. 9 - Prob. 6QSCh. 9 - Prob. 7QSCh. 9 - Prob. 8QSCh. 9 - Prob. 9QSCh. 9 - Prob. 10QSCh. 9 - Prob. 11QSCh. 9 - Prob. 12QSCh. 9 - Prob. 13QSCh. 9 - Prob. 1ECh. 9 - Prob. 2ECh. 9 - Prob. 3ECh. 9 - Prob. 4ECh. 9 - Prob. 5ECh. 9 - Prob. 6ECh. 9 - Prob. 7ECh. 9 - Prob. 8ECh. 9 - Prob. 9ECh. 9 - Prob. 10ECh. 9 - Prob. 11ECh. 9 - Prob. 12ECh. 9 - Prob. 13ECh. 9 - Prob. 14ECh. 9 - Prob. 15ECh. 9 - Prob. 16ECh. 9 - Prob. 17ECh. 9 - Prob. 1APSACh. 9 - Prob. 2APSACh. 9 - Problem 9-3A Aging accounts receivable and...Ch. 9 - Prob. 4APSACh. 9 - Prob. 5APSACh. 9 - Prob. 1BPSBCh. 9 - Prob. 2BPSBCh. 9 - Prob. 3BPSBCh. 9 - Prob. 4BPSBCh. 9 - Prob. 5BPSBCh. 9 - Business Solutions P1 P2 SP 9 Santana Rey, owner...Ch. 9 - Prob. 1GLPCh. 9 - Prob. 1BTNCh. 9 - Prob. 2BTNCh. 9 - Prob. 3BTNCh. 9 - Prob. 4BTNCh. 9 - Prob. 5BTNCh. 9 - Prob. 6BTNCh. 9 - Prob. 7BTNCh. 9 - Prob. 8BTNCh. 9 - Prob. 9BTN
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