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Homework answers / question archive / The table below shows the aging of AR and the estimted % uncollectable
The table below shows the aging of AR and the estimted % uncollectable. Calculate the amount uncollectable for each aging period AND prepare the journal entry needed to adjust the ADA acount given the different unadjusted balances. Over 90 days Customer name Current Total AR Aging : Days Past Due 31 - 60 61-90 1-30 days days days 5,000 4,000 15,000 5,000 8,000 7,500 Social Distancing Inc. Xbox Extreme Company Streaming and Binging, Inc. 18,500 14,700 16,300 6,000 27,500 40,700 31,800 Totals 49,500 28,000 12,500 4,000 6,000 100,000 % Uncollectable 1% 2% 5% 10% 22% **Amount Uncollectible
1) Determine the journal entry needed if the unadjusted balance for Allowance for Doubtful Accounts is a $2000 credit balance. ACCOUNT DEBIT CREDIT 31-Dec ADA 2). Determine the journal entry needed if the unadjusted balance for Allowance for Doubtful Accounts is a $500 debit balance. ACCOUNT DEBIT CREDIT 31-Dec ADA
Calculate ending balance of allowance for doubtful accounts
| Current | 1-30 | 31-60 | 61-90 | Over 90 | Total | |
| Account receivable | 49500 | 28000 | 12500 | 4000 | 6000 | 100000 |
| % Uncollectible | 1% | 2% | 5% | 10% | 22% | |
| $ Uncollectible | 495 | 560 | 625 | 400 | 1320 | 3400 |
Adjusting entry
| Date | General Journal | Debit | Credit |
| Dec 31 | Bad debt expense (3400-2000) | 1400 | |
| Allowance for Doubtful accounts | 1400 | ||
| (To record adjusting entry) |
T account (ADA)
| Beg Bal | 2000 | ||
| Adjusting entry | 1400 | ||
| End Bal | 3400 | ||
Adjusting entry
| Date | General Journal | Debit | Credit |
| Dec 31 | Bad debt expense (3400+500) | 3900 | |
| Allowance for Doubtful accounts | 3900 | ||
| (To record adjusting entry) |
T account (ADA)
| Beg Bal | 500 | ||
| Adjusting entry | 3900 | ||
| End Bal | 3400 |
