Question

7 Assignment Exercise 7-7 Aging of receivables method LO P3 Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis. ints Days Past Due Skipped 1 Total $635,000 0 $400,000 to 30 $103,000 31 to 60 61 to 90 $49,000 $31,000 Over 90 $43,000 Book Accounts receivable Percent uncollectible Hint Print references a. Complete the below table to calculate the estimated balance of Allowance for Doubtful Accounts using the aging of accounts receivable method b. Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $4.900 credit c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $1.400 debit. Complete this question by entering your answers in the tabs below. ReGA Reg B and Complete the below table to calculate the estimated balance of Allowance for Doubtful Accounts using the aging of accounts receivable method Accounts Receivable Percent Uncollectible (4) Not due 1 to 30: < Prev 6 of 13 !!! Next >

Answer 1

Part-a: Daley Corporation
	Total	Days Past Due
		0	1 to 30	31 to 60	61 to 90	Over 90
Accounts receivable (a)	$635,000	$409,000	$103,000	$49,000	$31,000	$43,000
Percent un-collectible (b)		2%	3%	6%	8%	11%
Allowance for doubtful accounts balance (axb)	$21,420	$8,180	$3,090	$2,940	$2,480	$4,730

Part-b: Journal Entry
Account Tittle	Debit	Credit
Bad debt expense ($21420-$4900)	$16,520
Allowance for doubtful accounts		$16,520
To record estimated Bad Debts Expense

Part-c: Journal Entry
Account Tittle	Debit	Credit
Bad debt expense ($21420+$1400)	$22,820
Allowance for doubtful accounts		$22,820
To record estimated Bad Debts Expense