Question
In: Accounting
B-Good, Inc. has accounts receivable at September 30 of $1,000,000. At September 30, Allowance for Doubtful...
| B-Good, Inc. has accounts receivable at September 30 of $1,000,000. At September 30, Allowance for Doubtful Accounts has a | |||||||||
| credit balance (prior to adjustment) of | $ 2,250 | ||||||||
| The Company uses the percentage of receivables basis for estimating uncollectible accounts. An analysis of the accounts | |||||||||
| and the percentage of estimated bad debts are as follows: | |||||||||
| Month of | Age of | 9/30 | Estimated % | ||||||
| Sale: | Accounts | Balance | Uncollectible | ||||||
| September | 1 - 30 days | $650,000 | 2.5% | ||||||
| August | 31 - 60 days | 150,000 | 6.0% | ||||||
| July | 61 - 90 days | 120,000 | 33.0% | ||||||
| June | 91-120 days | 50,000 | 59.0% | ||||||
| Prior to June | over 120 days | 30,000 | 90.0% | ||||||
| $1,000,000 | |||||||||
| Instructions: | |||||||||
| (a) Determine the total estimated uncollectibles. | |||||||||
| Total | |||||||||
| Age of | Estimated | ||||||||
| Accounts | Balance | % | Uncollectible | ||||||
| Cell Reference | Cell Reference | Cell Reference | Formula | ||||||
| Cell Reference | Cell Reference | Cell Reference | Formula | ||||||
| Cell Reference | Cell Reference | Cell Reference | Formula | ||||||
| Cell Reference | Cell Reference | Cell Reference | Formula | ||||||
| Cell Reference | Cell Reference | Cell Reference | Formula | ||||||
| Formula | |||||||||
| (b) Record the adjusting journal entry to estimate bad debts. Include an explanation of the entry. | |||||||||
| Debit | Credit | ||||||||
| Sep 30 | Account Title | Formula | |||||||
| Account Title | Cell Reference | ||||||||
| Explanation | |||||||||
| (c) On 10/15, management authorizes the write-off of an uncollectible customer account with a balance of | $ 9,640 | ||||||||
| Record this write off. | |||||||||
| Debit | Credit | ||||||||
| Oct. 15 | Account Title | Cell Reference | |||||||
| Account Title | Cell Reference | ||||||||
Solutions
ekkarill92 answered 1 year agoRelated Solutions
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5,633,555
Accounts
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190,000
Allowance
for Doubtful Accounts
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Merchandise Inventory
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Supplies
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Land
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Vehicles
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Equipment
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Bank
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654,714
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