plish Company has accounts receivable of $113,300 at March 31, 2020. Credit terms are 2/10, n/30. At March 31, 2020, there is a $1,500 credit balance in Allowance for Doubtful Accounts prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The company's estimate of bad debts is shown below. Age of Accounts Balance, March 31 Estimated Percentage Uncollectible 2020 2019 Current $76,100 $75,000 2% 1–30 days past due 19,800 8,000 6% 31–90 days past due 9,600 2,400 25% Over 90 days past due 7,800 1,100 51% $113,300 $86,500 (a) Determine the total estimated uncollectibles. Total estimated uncollectibles $enter the total estimated uncollectibles
plish Company has accounts receivable of $113,300 at March 31, 2020. Credit terms are 2/10, n/30. At March 31, 2020, there is a $1,500 credit balance in Allowance for Doubtful Accounts prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The company's estimate of bad debts is shown below. Age of Accounts Balance, March 31 Estimated Percentage Uncollectible 2020 2019 Current $76,100 $75,000 2% 1–30 days past due 19,800 8,000 6% 31–90 days past due 9,600 2,400 25% Over 90 days past due 7,800 1,100 51% $113,300 $86,500 (a) Determine the total estimated uncollectibles. Total estimated uncollectibles $enter the total estimated uncollectibles
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter5: Sales And Receivables
Section: Chapter Questions
Problem 94.2C
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Concept explainers
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
plish Company has accounts receivable of $113,300 at March 31, 2020. Credit terms are 2/10, n/30. At March 31, 2020, there is a $1,500 credit balance in Allowance for Doubtful Accounts prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The company's estimate of bad debts is shown below.
|
Age of Accounts |
Balance,
March 31 |
Estimated Percentage
Uncollectible |
||||
|---|---|---|---|---|---|---|
| 2020 | 2019 | |||||
| Current | $76,100 | $75,000 | 2% | |||
| 1–30 days past due | 19,800 | 8,000 | 6% | |||
| 31–90 days past due | 9,600 | 2,400 | 25% | |||
| Over 90 days past due | 7,800 | 1,100 | 51% | |||
| $113,300 | $86,500 |
(a)
Determine the total estimated uncollectibles.
| Total estimated uncollectibles | $enter the total estimated uncollectibles |
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