Blossom Company has accounts receivable of $98,700 at March 31, 2017. Credit ter
ID: 2552122 • Letter: B
Question
Blossom Company has accounts receivable of $98,700 at March 31, 2017. Credit terms are 2/10, n/30. At March 31, 2017, there is a s2,045 credit balance in Allowance for Doubtful Accounts prior to adjustment. The company uses the percentage-of-recelvables basis for estimating uncollectible accounts. The company's estimates of bad debts are as shown below Estimated Percentage 2016 Uncollectible Balance, March 31 e of Accounts Current 1-30 days past due 31-90 days past due 2017 $68,400 S70,460 12,900 ,130 9,200 2,330 Over 90 days past due8,200 1,180 $98,700 582,100 2% 29 47 Determine the total estimated uncollectibles. The total estimated uncollectibles LINK TO TEXI VIDEO: APPLIED SKILLS VIDEO: SIMILAR EXERCISE 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.) Account Titles and Explanation Debit CreditExplanation / Answer
Answer 1. Age of Accounts Balance Mar 31, 2017 % Uncollectible Amount Uncollectible Current 68,400.00 2% 1,368.00 1 - 30 Days 12,900.00 5% 645.00 31 - 90 Days 9,200.00 29% 2,668.00 Over 90 Days 8,200.00 47% 3,854.00 Total 98,700.00 8,535.00 Total Amount Uncollectible 8,535.00 Answer 2. Journal Entry Date Particulars Dr. Amt. Cr. Amt. 31-Mar-17 Bad Debts Expense 6,490.00 Allowance for Doubtful Accounts 6,490.00 (To record the bad debts expense) Bad Debt Expense = $8,535 - $2,045 = $6,490