Question

48

Kirchhoff Industries has a past history of uncollectible accounts, as shown below. Age Class Percent Uncollectible Not past due 2% 1-30 days past due 6 31-60 days past due 25 61-90 days past due 35 Over 90 days past due 50 Estimate the allowance for doubtful accounts, based the aging of receivables schedule below. Kirchhoff Industries Aging of Receivables Schedule Customer Balance Not Past Due 1-30 Days Past Due 178,900 31-60 Days Past Due 61-90 Days Past Due 40,700 Over 90 Days Past Due 40,500 15,600 73,200 Subtotals Conover Industries 19,100 8,300 Keystone Company Moxie Creek Inc. Rainbow Company Swanson Company Totals 813,000 479,700 15,600 19,100 8,300 10,100 29,600 29,600 895,700 509,300 2% 10,100 189,000 6% 81,500 25% 59,800 35% 56,100 50% Percentage uncollectible Allowance for Doubtful Accounts

Answer 1

Particulars	Balance	Not past due	Days past due 1-30	Days past due 31-60	Days past due 61-90	Days past due over 90
Total receivables	895,700	509,300	189,000	81,500	59,800	56,100
Percentage uncollectible		2%	6%	25%	35%	50%
Allowance for doubtful accounts	90,881	10,186	11,340	20,375	20,930	28,050