A Company Has the Following Unadjusted Account Balances at December

question 164

Essay

A company has the following unadjusted account balances at December 31,of the current year: Accounts Receivable of $185,700 and Allowance for Doubtful Accounts of $1,600 (credit balance).This company uses the aging of accounts receivable to estimate its bad debts.The following aging schedule reflects its accounts receivable at the current year-end:
$\begin{array}{|l|c|c|} \hline &&\text {Estimated}\\ &&\text {Uncollectible}\\ \hline \text { Account Age } & \text { Balance } & \text { Percentage}\\\hline \text { Current (notyet due) } &\$96,000&1.0\%\\\hline \text { 1 - 30 days past due} &64,000&3.5\\ \hline\text { 31-60 days past due} &16,000&12.0\\\hline \text { 61-90 } &6,500&42.0\\\hline \text { Over 90 days past due } &3,200&67.0\\ \hline \text { Total } &\$185,700\\ \hline \end{array}$

a.Calculate the amount of the allowance for doubtful accounts that should appear on the December 31 of the current year balance sheet.
b Prepare the adjusting journal entry to record bad debts expense for the current year.

Comprehend the implications of market failure and government intervention.

Recognize the challenges in achieving efficient outcomes through public decision-making processes.

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Describe factors that contribute to social attraction and love.

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Definitions:

Low Range

A setting in a vehicle's transmission that provides increased torque and reduced speed, advantageous for off-roading or towing.

DTCs

Diagnostic Trouble Codes, which are codes stored by a vehicle's onboard computer system to indicate issues within the vehicle.

Allison ECAT

A software tool designed for diagnosing and programming Allison transmissions, aiding in efficient maintenance and problem resolution.

ET

Stands for "Elapsed Time," commonly used in motorsports to refer to the time it takes for a vehicle to complete a given distance from a standing start.