Show Me How Estimating Doubtful Accounts nccounts recelvable on December 31 and
ID: 2519722 • Letter: S
Question
Show Me How Estimating Doubtful Accounts nccounts recelvable on December 31 and a historical analysis of the percentage of Performance Bike Co. is a wholesaler of motorcycle supplies. An aging of the company's uncollectible accounts in each age category are as follows Estimate what the proper balance of the allowance for doubtflul accounts should be as of December 31 Eatimation of Uncollectible A Age Interval Not past due 704,000 31-60 days past due35,200 61-90 days past due25300 91-180 days past due 18,300 Over 180 days pant due 13,40D 2 more Check My Wonk uses remaning work saved ) m 7 8Explanation / Answer
Calculation of balance of allowance for doubtful debts
Age interval
Balance (A)
Estimated uncollectable balance %
(B)
Estimated uncollectable amount
(C=A*B))
Not Due
$704,000
0.75%
$5,280.00
1-30 days past due
$77,400
3%
$2,322.00
31-60 days past due
$35,200
9%
$3,168.00
61-90 days past due
$25,300
17%
$4,301.00
91-180 days past due
$18,300
39%
$7,137.00
Over 180 days past due
$13,400
70%
$9,380.00
Total
$873,600
$31,588.00
Ans
balance of allowance for doubtful debts = $31,588
Calculation of balance of allowance for doubtful debts
Age interval
Balance (A)
Estimated uncollectable balance %
(B)
Estimated uncollectable amount
(C=A*B))
Not Due
$704,000
0.75%
$5,280.00
1-30 days past due
$77,400
3%
$2,322.00
31-60 days past due
$35,200
9%
$3,168.00
61-90 days past due
$25,300
17%
$4,301.00
91-180 days past due
$18,300
39%
$7,137.00
Over 180 days past due
$13,400
70%
$9,380.00
Total
$873,600
$31,588.00
Ans
balance of allowance for doubtful debts = $31,588