Question

** ACCOUNTING HOMEWORK**

Blocker Company estimates its uncollectible accounts based on an analysis of receivables. On December 31, a junior accountant prepared the following aging schedule for the company’s $88,000 in outstanding receivables.

Estimated Uncollectible Accounts Age Interval Amount % Not due $58,650 1-30 days past due 13,220 4% 31-60 days past due 8,930 20% 61-90 days past due 4,000 30% Over 90 days past due 3,200 50% 588,000 The allowance for Doubtful Accounts currently has a $210 debit balance. 1. Prepare the adjusting entry to record the company's estimate of uncollectible accounts Accounts CR Date DR 2. Prepare the journal entry to write off the following accounts: T. Donaldson......... $ 700 450 D. Mie Date Accounts DR 1.000 CR 3. Prepare the journal entry to record receipt of the $450 owed by J. Kyle. Date Accounts DR CR 4. Write an answer to the following question: What circumstances would cause the Allowance for doubtful Accounts to have a debit balance prior to adjustment?

Answer 1

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A B С D E F G H I 1 2 3 Sr. No Account title and Explanation Debit Credit 1 Uncollectible Accounts Expense 6497.8 Allowance for Doubtful Accounts 6497.& (To record allowance for doubtful accounts) 4 % of Allowance Accounts I Amount 2% 58650 1173 4% 13220 528.8 20% 8930 1786 30% 4000 1200 50% 3200 1600 88000 6287.8 5 6 7 2 2150 8 700 Allowance for Doubtful Accounts Accounts Receivable-T. Donaldson . Accounts Receivable-). Kyle Accounts Receivable-D. Mize (To write of few accounts) 9 9 10 450 Allowance for Doubtful allowance Balance 210 Debit Balance 1000 11 12 13 3 14 Accounts Receivable-J. Kyle 450 Allowance for Doubtful Accounts (To reverse the write off of J.Kyle account) 450 15 16 17 18 Cash 450 Accounts Receivable-). Kyle (To record receipt of cash from J.Kyle) 450 19 20 21 22 4 23 The actual amount of uncollectible accounts written off in the prior accounting period was greater than the estimate used to record the adjusting entry for bad debts. 24 25 Ke Sheet229 Sheet230 Sheet232 Sheet231 Sheet233 Sheet234 Sheet235 Sheet236 Sheet236 Stats

For calculation ref:

A B С D E F G H 1 Credit 2 3 Sr. No Account title and Explanation Debit 1 Uncollectible Accounts Expense =D8+D10 Allowance for Doubtful Accounts (To record allowance for doubtful accounts) 4 =13 % of Allowance Accounts Receviable Balance Amount 0.02 58650 =C3%B3 0.04 13220 =C4*B4 0.2 8930 =C5*B5 0.3 4000 =C6*B6 0.5 3200 =C7*B7 =SUM(C3:07) =SUM(D3:07) 5 6 7 2 8 9 Allowance for Doubtful Accounts =SUM(18:J10) Accounts Receivable-T. Donaldson 700 Accounts Receivable-). Kyle 450 Accounts Receivable-D. Mize 1000 (To write of few accounts) 10 Allowance for Doubtful allowance Balance 210 Debit Balance 11 12 3 13 14 15 16 Accounts Receivable-). Kyle =J9 Allowance for Doubtful Accounts (To reverse the write off of J.Kyle account) =113 17 18 Cash =J18 Accounts Receivable-). Kyle (To record receipt of cash from J.Kyle) =113 19 20 21 22 4 23 The actual amount of uncollectible accounts written off in the prior accounting period was greater than the estimate used to record the adjusting entry for bad debts. 24 25 Sheet229 Sheet230 Sheet232 Sheet231 Sheet233 Sheet234 Sheet235 Sheet236 Stats Ready Type here to search