Question

In: Accounting

Amazing Company has the following information available as of December 31, 2017: Total Accounts 1-30 31-60...

Amazing Company has the following information available as of December 31, 2017:

Total

Accounts 1-30 31-60 61-90 Over 90

Receivable Days Days Days Days

£90,000 £73,400 £9,400 £4,700 £2,500

Total credit sales for the year ended December 31, 2017, were £825,000.

The balance in the Allowance for Uncollectible Accounts at December 31, 2016, is £7000 and

the company wrote-off £1200 during 2017. The estimated bad debts percentages (as a

percentage of aging accounts receivable) are as follows:

1-30 days 3%

31-60 days 15%

61-90 days 35%

Over 90 days 75%

i. Calculate an estimate of bad debt expense that the company should recognize for the year

if it estimates bad debts using ageing schedule method.

ii. Please also record the transaction for recognizing bad debt expense.

iii. What would be the net accounts receivable reported on the balance sheet prepared on December 31,2017

Expert Solution

ekkarill92 answered 1 year ago

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