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Title : Under The Allowance Method Of Accounting For Uncollectible Accounts
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Under The Allowance Method Of Accounting For Uncollectible Accounts
Under The Allowance Method Of Accounting For Uncollectible AccountsUnder The Allowance Method Of Accounting For Uncollectible Accounts - Hello Friend Accounting Methods, In the article you read this time with the title Under The Allowance Method Of Accounting For Uncollectible Accounts, We have prepared this article for you to read and retrieve information therein. Hopefully the contents of postings Article accounting, We write this you can understand. Alright, good read.
Title : Under The Allowance Method Of Accounting For Uncollectible Accounts
link : Under The Allowance Method Of Accounting For Uncollectible Accounts
Under The Allowance Method Of Accounting For Uncollectible Accounts
Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis.
| Days Past Due | |||||||||||||||||||||||
| Total | 0 | 1 to 30 | 31 to 60 | 61 to 90 | Over 90 | ||||||||||||||||||
| Accounts receivable | $ | 595,000 | $ | 401,000 | $ | 95,000 | $ | 41,000 | $ | 23,000 | $ | 35,000 | |||||||||||
| Percent uncollectible | 3 | % | 4 | % | 7 | % | 9 | % | 12 | % | |||||||||||||
a. Complete the below table to calculate the estimated balance of Allowance for Doubtful Accounts using the aging of accounts receivable method.
b. Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $4,100 credit.
c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $600 debit.
Explanation
b. & c.
| Unadjusted balance | $ | 4,100 | credit |
| Estimated balance | 24,970 | credit | |
| Required adjustment | $ | 20,870 | credit |
| Unadjusted balance | $ | 600 | debit |
| Estimated balance | 24,970 | credit | |
| Required adjustment | $ | 25,570 | credit |
Thank you!
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