Aging of Receivables Schedule for 2012 Total 0-30 Days 31-60 Days 61-90 Days Ove
ID: 2533089 • Letter: A
Question
Aging of Receivables Schedule for 2012
Total
0-30 Days
31-60 Days
61-90 Days
Over 90 Days
Accounts Receivable
$677,000
$225,000
$240,000
$127,000
$85,000
Estimated % of Receivables that are uncollectible
1%
9%
23%
60%
Allowance for Uncollectibles
Allowance for Uncollectibles (Allowance for Doubtful Accounts) has a 1/1/12 Credit Balance of $70,000.
1. What is the Year-end adjusting entry that must be made?
Dr. _______________________________________________________________________________
Cr. _______________________________________________________________________________
Total
0-30 Days
31-60 Days
61-90 Days
Over 90 Days
Accounts Receivable
$677,000
$225,000
$240,000
$127,000
$85,000
Estimated % of Receivables that are uncollectible
1%
9%
23%
60%
Allowance for Uncollectibles
Explanation / Answer
Solution:
Begining balance fo allowance for doubtful acounts = $70,000
Bad debts expense to be recorded for the period = $104,060 - $70,000 = $34,060
Computation of Allowance for doubtful Accounts Ageing Accounts Receivables % Uncollectible Required Allowance 0-30 days $225,000.00 1% $2,250.00 31-60 days $240,000.00 9% $21,600.00 61-90 days $127,000.00 23% $29,210.00 Over 90 days $85,000.00 60% $51,000.00 Total $677,000.00 $104,060.00