Question

Vaughn Company has accounts receivable of $116,500 at March 31, 2020. Credit terms are 2/10, n/30. At March 31, 2020, there is a $1,400 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. Balance, March 31 Estimated Percentage Uncollectible Age of Accounts Current 1-30 days past due 31-90 days past due Over 90 days past due 2020 $80,600 17,900 9,000 9,000 $116,500 2019 $75,000 8,000 2,400 1.100 4% 6% 25% 50% $86,500 Part 1 Determine the total estimated uncollectibles. Total estimated uncollectibles $ e Textbook and Media List of Accounts Save for Later Attempts: unlimited Submit Answer

Answer 1

Total Estimated Uncollectible $ - 11,048

Calculations	Balance $
Age of Accounts	March, 31,2020	Estimated % Uncollectible	Total Estimated Unollectibles
Current	80,600	4%	3,224
1-30 days past due	17,900	6%	1,074
31-90 days past due	9,000	25%	2,250
Over 90 days past due	9,000	50%	4,500
Total			11,048

Journal entry for Adjustment

Date	Account Title & Explanations	Debit $	Credit $
March, 31,2020	Uncollectible Accounts Expenses	9,648
To Allowance for Doubtful Accounts		9,648
	(Being : Adjustment Entry-($11048-$1400)