21. Ebasan Company estimates its doubtful accounts by aging its accounts receivable. The aging schedule ofaccounts receivable at December 31, 2020 is presented below:Age of Accounts0-30 days31-60 daysAmountP1,264,800691,50061-90 days288,600114,97591-120 daysOver 120 days59,100Ebasan's uncollectible accounts experience for the past 5 years are summarized in the following schedule:Year0-3031-60 61-90 91-120 Over 1202019Receivable(Dec 31)P1,968,7501,500,000697,5000.3% 1.8% 12%38%65%20180.5%1.6%41%70%20171.5%0%50%69%0.2%0.4%20161,224,0001,7% 10.2%47%81%20151,865,5000.9% 2.0% 9.7% 33%95%The balance of the allowance for doubtful accounts at December 31, 2020 before adjustment is P126,751. Thenecessary adjusting journal entry to adjust the allowance for doubtful accounts as of Dec 31,2020 wouldinclude:A. A debit to retained earnings of P13,894,B. A debit to doubtful accounts expense P140,644.C.A credit to doubtful accounts expense P140,644.D. A credit to allowance for doubtful accounts of P13,894.

Allowance for doubtful debts: It is a contra-asset account that is related with accounts receivable…

21. Ebasan Company estimates its doubtful accounts by aging its accounts receivable. The aging schedule of accounts receivable at December 31, 2020 is presented below: Age of Accounts Amount P1,264,800 0-30 days 31-60 days 691,500 61-90 days 288,600 114,975 91-120 days Over 120 days 59,100 Ebasan's uncollectible accounts experience for the past 5 years are summarized in the following schedule: Year 0-30 31-60 61-90 91-120 Over 120 2019 1.8% 12% 38% 65% Receivable (Dec 31) P1,968,750 1,500,000 697,500 1,224,000 2018 41% 70% 2017 0.3% 0.5% 1.6% 0.2% 1.5% 9% 0.4% 1.7% 10.2% 1 0.9% 2.0% 9.7% 50% 69% 2016 47% 81% 2015 1,865,500 33% 95% The balance of the allowance for doubtful accounts at December 31, 2020 before adjustment is P126,751. The necessary adjusting journal entry to adjust the allowance for doubtful accounts as of Dec 31,2020 would include: A. A debit to retained earnings of P13,894. B. A debit to doubtful accounts expense P140,644. C. A credit to doubtful accounts expense P140,644. D A credit to allowance for doubtful accounts of P13.894.

21. Ebasan Company estimates its doubtful accounts by aging its accounts receivable. The aging schedule of accounts receivable at December 31, 2020 is presented below: Age of Accounts Amount P1,264,800 0-30 days 31-60 days 691,500 61-90 days 288,600 114,975 91-120 days Over 120 days 59,100 Ebasan's uncollectible accounts experience for the past 5 years are summarized in the following schedule: Year 0-30 31-60 61-90 91-120 Over 120 2019 1.8% 12% 38% 65% Receivable (Dec 31) P1,968,750 1,500,000 697,500 1,224,000 2018 41% 70% 2017 0.3% 0.5% 1.6% 0.2% 1.5% 9% 0.4% 1.7% 10.2% 1 0.9% 2.0% 9.7% 50% 69% 2016 47% 81% 2015 1,865,500 33% 95% The balance of the allowance for doubtful accounts at December 31, 2020 before adjustment is P126,751. The necessary adjusting journal entry to adjust the allowance for doubtful accounts as of Dec 31,2020 would include: A. A debit to retained earnings of P13,894. B. A debit to doubtful accounts expense P140,644. C. A credit to doubtful accounts expense P140,644. D A credit to allowance for doubtful accounts of P13.894.

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter16: Accounting For Accounts Receivable

Section: Chapter Questions

Problem 10SPA: AGING ACCOUNTS RECEIVABLE An analysis of the accounts receivable of Johnson Company as of December...

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Prior to adjustments, Barrett Companys account balances at December 31, 2019, for Accounts Receivable and the related Allowance for Doubtful Accounts were 1,200,000 and 60,000, respectively. An aging of accounts receivable indicated that 106,000 of the December 31, 2019, receivables may be uncollectible. The net realizable value of accounts receivable at December 31, 2019, was: a. 1,034,000 b. 1,094,000 c. 1,140,000 d. 1,154,000
At the end of 20-3, Martel Co. had 410,000 in Accounts Receivable and a credit balance of 300 in Allowance for Doubtful Accounts. Martel has now been in business for three years and wants to base its estimate of uncollectible accounts on its own experience. Assume that Martel Co.s adjusting entry for uncollectible accounts on December 31, 20-2, was a debit to Bad Debt Expense and a credit to Allowance for Doubtful Accounts of 25,000. (a) Estimate Martels uncollectible accounts percentage based on its actual bad debt experience during the past two years. (b) Prepare the adjusting entry on December 31, 20-3, for Martel Co.s uncollectible accounts.
Kirchhoff Industries has a past history of uncollectible accounts, as follows. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule you completed in Exercise 9-8.
Estimating allowance for doubtful accounts Evers Industries has a past history of uncollectible accounts, as follows. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule you completed in Exercise 8-8.
Mirror Mart uses the balance sheet aging method to account for uncollectible debt on receivables. The following is the past-due category information for outstanding receivable debt for 2019. To manage earnings more efficiently, Mirror Mart decided to change past-due categories as follows. Complete the following. A. Complete each table by filling in the blanks. B. Determine the difference between total uncollectible. C. Explain how the new total uncollectible amount affects net income and accounts receivable.
AGING ACCOUNTS RECEIVABLE An analysis of the accounts receivable of Johnson Company as of December 31, 20--, reveals the following: REQUIRED 1. Prepare an aging schedule as of December 31, 20--, by adding the following column to the three columns shown above: Estimated Amount Uncollectible. 2. Assuming that Allowance for Doubtful Accounts had a credit balance of 620 before adjustment, record the end-of-period adjusting entry in general journal form to enter the estimate for uncollectible accounts.
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