Aging of Wig Creations Company supplies wigs and hair care products to beauty sa
ID: 2566733 • Letter: A
Question
Aging of Wig Creations Company supplies wigs and hair care products to beauty salons throughout Texas and the Southwest. The accounts receivable clerk for Wig Creations prepared the following partially completed aging of receivables schedule as of the end of business on December 31, 20Y1: Days Past Due Not Past Due 1-30 31-60 91-120 61-90 over 120 707,000 392,300 169,700 77,800 26,200 23,300 17,700 The following accounts were unintentionally omitted from the aging schedule: Customer Due Date May 28, 20Y Sept. 7, 20i Oct. 17, 20Y1 Oct. 24, 20Y Nov. 23, 20Y1 Nov. 29, 20Y1 Dec. 2, 20Y Jan. 5, 20Y2 $3,000 6,300 Excel Hair Products First Class Hair Care Oh The Hair One Stop Hair Designs Visions Hair and Nail Wig Creations has a past history of uncollectible accounts by age category, as follows 3,600 2,300 7,700Explanation / Answer
2. Wig Creations Company
Aging of Receivables Schedule
December 31, 20Y1
3. Allowance for Doubtful Accounts = $ 53,340.
4. In the books of Wigs Creations :
Customer Balance Not Past Due 1-30 31-60 61-90 91-120 Over 120 Subtotals 707,000 392,300 169,700 77,800 26,200 23,300 17,700 Arcade Beauty 3,000 0 0 0 0 0 3,000 Creative Images 6,300 0 0 0 0 6,300 0 Excel Hair Products 800 0 0 0 800 0 0 First Class Hair Care 2,100 0 0 0 2,100 0 0 Golden Images 700 0 0 700 0 0 0 Oh The Hair 3,600 0 0 3,600 0 0 0 One Stop Hair Designs 2,300 0 2,300 0 0 0 0 Visions Hair and Nail 7,700 7,700 0 0 0 0 0 Totals 733,500 400,000 172,000 82,100 29,100 29,600 20,700 Percent Uncollectible 0 2% 4 % 10 % 15 % 35% 75 % Estimate of Uncollectible Amounts 0 8,000 6,880 8,210 4,365 10,360 15,525