Question

Tableau DA 7-2: Percent of sales method, percent of recelvables method, and aging of receivables method LO P3 The manager asks you to assist her with the data analytics on bad debts expense at year-end. To do this, you access the following Tableau Dashboard for your company. $732000 Makeup of Current Assets $1220000 $1708000 $476000 Cash Accounts Receivable Inventory Supplies Value (5) Accounts Receivable by Age Over 90 days past due $12000 61.90 days past due $38000 31.60 days past due $86000 $254000 1-30 days past due Not yet due $830000 $200 000 5300000 US $400 000 5600000 Accounts Receivable (s) Percent Uncollectible by Age Makeup of Total Sales Prev 1 of 1

Answer 1

Ans 1 Based on percentage of sales Credit sales $71,50,000 Uncollectible percentage 1% Balance in Allowance for Doubtful Accounts $71,500 [$7150000 x 1%] Estimated balance of allowance for uncollectible is $71500 Ans 2 Based on percentage of receivable Accounts Receivable $12,20,000 Uncollectible percentage 5% Balance in Allowance for Doubtful Accounts $61,000 ($1220000 x 1%] Estimated balance of allowance for uncollectible is $61000 Ans 3 Based on ageing of receivable Particulars Accounts Receivable Uncollectible percentage Uncollectible amount 3% = Not Yet due 1-30 days past due 31-60 days past due 30-90 days past due Over 90 days past due Estimated balance of allowance for uncollectible $8,30,000 x $2,54,000 X $86,000 x $38,000 x $12,000 x 7% $16,600 $7,620 $6,020 $12,540 $8,160 33% = 68% $12,20,000 $50,940