Question
In: Accounting
Performace bike co is a wholesaler of motorcycle supplies.An aging of the company's account receivable on December 31
Performace bike co is a wholesaler of motorcycle supplies.An aging of the company's account receivable on December 31 and a historical analysis of the percentage of uncollectible accounts in each age category are as follows
| Age Interval | Balance | Percent Uncollectible |
| Not past due | $3,250,000 | 0.8% |
| 1-30 days past due | 10,50,000 | 2.4% |
| 31-60 days past due | 7,80,000 | 7.0 |
| 61-90 days past due | 3,20,000 | 18.0 |
| 91-180 days past due | 2,40,000 | 34.0 |
| over 180 days past due | 1,50,000 | 85.0 |
Estimate the proper balance of the allowance for doubtful accounts as of December 31
Solutions
Expert Solution
Analysis of receivable method : The analysis of receivable method is a way of estimating the amount of uncollectible debt based on the age of each individual account. This method is sometimes referred to as the ageing of receivables method. Estimated bad debts would be considered as the intended adjusted balance for the provision for doubtful accounts under the analysis of receivables method.
Calculation of proper balance of the allowance for doubtful accounts as on December 31
Therefore, the estimated balance of the allowance for doubtful accounts as of december 31 is $372,500
balaji rao answered 2 years agoRelated Solutions
Kyla Co. prepared an aging of its accounts receivable at December 31, 2020 and determined that...
Kyla Co. prepared an aging of its accounts receivable at
December 31, 2020 and determined that the net realizable value of
the receivables was $580,000. Additional information for calendar
2020 follows:
Allowance for doubtful accounts, Jan 1
$68,000 (cr.)
Uncollectible account written off during year
46,000
Bad debt expense for 2020
28,000
Uncollectible accounts recovered during year
10,000
At the year end December 31, 2020, Kyla Co.’s Accounts
receivable balance should be
1)
$640,000.00
2)
$658,000.00
3)
$644,000.00
4)...
A summary of Klugman Company's December 31, 2021, accounts receivable aging schedule is presented below along...
A summary of Klugman
Company's December 31, 2021, accounts receivable aging schedule is
presented below along with the estimated percent uncollectible for
each age group:
Age Group
Amount
%
0–60
days
$
68,000
0.5
61–90 days
26,000
1.0
91–120 days
3,800
10.0
Over 120
days
1,200
50.0
The allowance for uncollectible accounts had a balance of $1,480 on
January 1, 2021. During the year, bad debts of $830 were written
off.
Required:
Prepare all journal entries for 2021 with respect...
A summary of Klugman Company's December 31, 2021, accounts receivable aging schedule is presented below along...
A summary of Klugman Company's December 31, 2021, accounts
receivable aging schedule is presented below along with the
estimated percent uncollectible for each age group:
Age Group
Amount
%
0–60 days
$
59,000
0.5
61–90 days
21,500
1.0
91–120 days
2,900
10.0
Over 120 days
1,200
50.0
The allowance for uncollectible accounts had a balance of
$1,390 on January 1, 2021. During the year, bad debts of $740 were
written off.
Required:
Prepare all journal entries for 2021 with respect...
A summary of Klugman Company's December 31, 2021, accounts receivable aging schedule is presented below along wit...
A summary of Klugman Company's December 31, 2021, accounts receivable aging schedule is presented below along with the estimated percent uncollectible for each age group:Age GroupAmount%0-60 days$58,0000.561-90 days21,0001.091-120 days2,88010.0Over 12 theta days1,00050.0The allowance for uncollectible accounts had a balance of $1,380 on January 1, 2021. During the year, bad debts of $730 were written off. Required: Prepare all journal entries for 2021 with respect to bad debts and the allowance for uncollectible accounts. (If no entry is required for a transaction/event, select...
Oriole Co. uses an aging schedule at December 31. Number of Days Outstanding Accounts Receivable Estimated...
Oriole Co. uses an aging schedule at December 31.
Number of Days
Outstanding
Accounts
Receivable
Estimated
%
Uncollectible
Estimated
Uncollectible
Accounts
0–30 days
$264,600
1%
$2,646
31-60 days
71,300
5%
3,565
61-90 days
45,400
11%
4,994
Over 90 days
21,600
19%
4,104
Total
$402,900
$15,309
A) Assuming the allowance for doubtful accounts has an
unadjusted credit balance of $4,980 at December 31, what is the bad
debt expense for the year?
Bad debt expense
$enter the Bad debt expense in...
Entry for Uncollectible Accounts Easy Rider International is a wholesaler of motorcycle supplies. An aging of...
Entry for Uncollectible Accounts
Easy Rider International is a wholesaler of motorcycle
supplies. An aging of the company's accounts receivable on December
31, 20Y3, and a historical analysis of the percentage of
uncollectible accounts in each age category are as follows:
Age Interval
Balance
Percent
Uncollectible
Not past due
$1,850,000
1
%
1–30 days past due
750,000
2
31–60 days past due
100,000
6
61–90 days past due
60,000
14
91–180 days past due
45,000
60
Over 180 days past...
35) The following aging information pertains to Jacobsen Co.'s accounts receivable at December 31, 2021: Days...
35) The following aging information pertains to Jacobsen Co.'s
accounts receivable at December 31, 2021:
Days Outstanding
Amount
Estimated % Uncollectible
0-30
$
420,000
2
%
31-60
140,000
5
%
61-120
100,000
10
%
Over 120
120,000
20
%
During 2021, Jacobsen wrote off $18,000 in receivables and
recovered $6,000 that had been written off in prior years.
Jacobsen's December 31, 2020, allowance for uncollectible accounts
was $40,000. Using the balance sheet approach, what amount of
allowance for uncollectible accounts...
An aging analysis of Pharoah Company’s accounts receivable at December 31, 2020 and 2021, showed the...
An aging analysis of Pharoah Company’s accounts receivable at
December 31, 2020 and 2021, showed the following:
Accounts Receivable
Number of Days Outstanding
Estimated %Uncollectible 2021
2020
0–30 days 3% 126,000 155,000
31–60 days 7% 31,500 77,500
61–90 days 13% 63,000 46,500
Over 90 days 40% 94,500 31,000
Total $315,000 $310,000
Additional information:
1.
At December 31, 2020, the unadjusted balance in Allowance for
Doubtful Accounts was a credit of $6,200.
2.
In 2021, $26,700 of accounts was written off...
An aging analysis of Yamoto Limited’s accounts receivable at December 31, 2018 and 2017, showed the...
An aging analysis of Yamoto Limited’s accounts receivable at
December 31, 2018 and 2017, showed the following:
Number of Days Outstanding
Accounts Receivable
Estimated Percentage Uncollectible
2018
2017
0-30 days
$300,000
$320,000
3%
31-61 days
64,000
114,000
6%
61-90 days
86,000
76,000
12%
Over 90 days
130,000
50,000
24%
Total
$580,000
$560,000
Additional information:
1. At December 31, 2017, the unadjusted balance in Allowance for
Doubtful Accounts was a credit of $9,000.
2. In 2018, $42,000 of accounts were written...
An aging analysis of Yamoto Limited’s accounts receivable at December 31, 2018 and 2017, showed the...
An aging analysis of Yamoto Limited’s accounts receivable at
December 31, 2018 and 2017, showed the following:
Number of Days Outstanding
Accounts Receivable
Estimated Percentage Uncollectible
2018
2017
0-30 days
$300,000
$320,000
3%
31-61 days
64,000
114,000
6%
61-90 days
86,000
76,000
12%
Over 90 days
130,000
50,000
24%
Total
$580,000
$560,000
Additional information:
1. At December 31, 2017, the unadjusted balance in Allowance for
Doubtful Accounts was a credit of $9,000.
2. In 2018, $42,000 of accounts were written...
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