Question

A summary of Klugman Company's December 31, 2018, accounts receivable aging schedule is presented below along with the estimated percent uncollectible for each age group: Age Group 0-60 days 61-90 days 91-120 days Over 120 days Amount $55,000 "19,500 2.500 1.000 5 1.0 10.0 50.0 The allowance for uncollectible accounts had a balance of $1,350 on January 1, 2018. During the year, bad debts of $700 were written off. aces Required: Prepare all journal entries for 2018 with respect to bad debts and the allowance for uncollectible accounts. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the entry to write-off specific accounts.

Answer 1

Solution

Transaction	General Journal	Debit	Credit
1	Allowance for doubtful accounts	$              700.00
	Accounts receivable		$        700.00
	(To record write-off defaulted account)
2	Bad debts expense	$              570.00
	Allowance for doubtful accounts		$        570.00
	(To record bad debts expense)

Working

Beginning balance of Allowance for Bad Debts account	$      1,350.00
Less: Amount written off	$        (700.00)
Unadjusted balance for allowance for bad debts	$          650.00

.

	Accounts receivables	x	Percent Uncollectable (%)	=	Estimated Uncollectable
Not due:		x	0.50%	=	$                      -
1 to 60:	$        55,000.00	x	0.50%	=	$             275.00
61 to 90	$        19,500.00	x	1.00%	=	$             195.00
91 to 120	$          2,500.00	x	10.00%	=	$             250.00
Over 120:	$          1,000.00	x	50.00%	=	$             500.00
Estimated balance of allowance for doubtful accounts					$         1,220.00

.

Estimated balance of allowance for uncollectables	$    1,220.00	Cr
Balance in Allowance for uncollectable account (Cr)	$        650.00	Cr
Total bad debts to be recorded	$        570.00	Cr