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In: Accounting

On December 31, Josh's Co. allowance for Doubtful Accounts has an unadjusted credit balance of $15,000....

On December 31, Josh's Co. allowance for Doubtful Accounts has an unadjusted credit balance of $15,000. Josh prepares a schedule of its December 31 accounts receivable by age.

Accounts Receivable		Age of Accounts Receivable	Expected Percent Uncollectible
$	900,000	Not yet due	1.35	%
	360,000	1 to 30 days past due	2.10
	72,000	31 to 60 days past due	6.60
	36,000	61 to 90 days past due	33.25
	14,400	Over 90 days past due	69.00

1A. Compute the required balance of the Allowance for Doubtful Accounts at December 31.

	Accounts Receivable		Percent Uncollectible (#.##%)		Estimated Uncollectible
Not Due		x		=
1 to 30		x		=
31 to 60		x		=
61 to 90		x		=
over 90		x		=
Estimated	balance		of allowance		for uncollectibles	$

1B. Prepare the adjusting entry to record bad debts expense at December 31. (Round percentage answers to nearest whole percent. Do not round intermediate calculations.)

Record the estimated bad debts.

No	Date	General Journal	Debit	Credit
1	Dec 31

Expert Solution

1A.

	Accounts Receivable		Percent Uncollectible (#.##%)		Estimated Uncollectible
Not Due	900,000	x	1.35%	=	12,150
1 to 30	360,000	x	2.10%	=	7,560
31 to 60	72,000	x	6.60%	=	4,752
61 to 90	36,000	x	33.25%	=	11,970
over 90	14,400	x	69%	=	9,936
Estimated balance of allowance for uncollectibles	1,382,400				46,368

1B.

Allowance for doubtful accounts, ending = $46,368

Allowance for doubtful accounts, existing = $15,000

Bad dent expense = Allowance for doubtful accounts, ending - Allowance for doubtful accounts, existing

= 46,368-15,000

= $31,368

No	Date	General Journal	Debit	Credit
1	Dec 31	Bad debt expense	$31,368
		Allowance for doubtful accounts		$31,368
		( To record bad debt expense)

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ekkarill92 answered 1 year ago

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