Question

Baltimore Company uses aging to estimate uncollectibles.  At the end of the fiscal year, December 31, 2018, Accounts Receivable has a balance that consists of:

Dollar Value	Age of Account	Estimated Collectible
$180,000	< 30 days old	99%
65,000	30 to 60 days old	94%
30,000	61 to 120 days old	78%
13,000	> 120 days old	17%

The current unadjusted Allowance for Uncollectible Accounts balance is a debit balance of $2,000 and the Bad Debt Expense accounts has an unadjusted balance of zero. After the adjusting entry is made, what will be the dollar balances in the Allowance for Doubtful Accounts? Round to nearest whole dollar.

Answer 1

Schedule

Days	Dollar value	Estimated uncollectible	Uncollectible amount
<30 days old	180000	1%	1800
30 to 60 days old	65000	6%	3900
61 to 120 days old	30000	22%	6600
> 120 days sold	13000	83%	10790
Total			23090

Dollar balances in the allowance for doubtful accounts = $23090