A H Not Days Past Due Past Customer 4 AAA Outfitters 5 Brown Trout Fly Shop Balance Due 1-30 31-60 61-90 91-120 Over 120 20,000 20,000 7,500 7,500 30 Zigs Fish Adventures 31 Subtotals 4,000 | 1,300,000 750,000 290,000 120,000 40,000 20,000 80,000 4,000 The following accounts were unintentionally omitted from the aging schedule: Customer Due Date Balance Adams Sports & Flies May 22, 20Y6 $5,000 Blue Dun Flies Oct. 10, 20Y6 4,900 Cicada Fish Co. Sept. 29, 20Y6 8,400 Deschutes Sports Oct. 20, 20Y6 7,000 Green River Sports Nov. 7, 20Y6 3,500 Smith River Co. Nov. 28, 20Y6 2,400 Western Trout Company Dec. 7, 20Y6 6,800 Wolfe Sports Jan. 20, 20Y 7| 4,400 Trophy Fish has a past history of uncollectible accounts by age category, as follows: Age Class Not past due Percent Uncollectible 19% |1-30 days past due 2 31-60 days past due 10 61-90 days past due 30 91-120 days past due 40 Over 120 days past due 80 Instructions 1. Determine the number of days past due for each of the preceding accounts. 2. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals. 3. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule. 4. Assume that the allowance for doubtful accounts for Trophy Fish Company has a debit balance of $3,600 before adjustment on December 31, 20Y6. Journalize the adjusting entry for uncollectible accounts. 5. Assuming that the adjusting entry in (4) was inadvertently omitted, how would the omission affect the balance sheet and income statement?
A H Not Days Past Due Past Customer 4 AAA Outfitters 5 Brown Trout Fly Shop Balance Due 1-30 31-60 61-90 91-120 Over 120 20,000 20,000 7,500 7,500 30 Zigs Fish Adventures 31 Subtotals 4,000 | 1,300,000 750,000 290,000 120,000 40,000 20,000 80,000 4,000 The following accounts were unintentionally omitted from the aging schedule: Customer Due Date Balance Adams Sports & Flies May 22, 20Y6 $5,000 Blue Dun Flies Oct. 10, 20Y6 4,900 Cicada Fish Co. Sept. 29, 20Y6 8,400 Deschutes Sports Oct. 20, 20Y6 7,000 Green River Sports Nov. 7, 20Y6 3,500 Smith River Co. Nov. 28, 20Y6 2,400 Western Trout Company Dec. 7, 20Y6 6,800 Wolfe Sports Jan. 20, 20Y 7| 4,400 Trophy Fish has a past history of uncollectible accounts by age category, as follows: Age Class Not past due Percent Uncollectible 19% |1-30 days past due 2 31-60 days past due 10 61-90 days past due 30 91-120 days past due 40 Over 120 days past due 80 Instructions 1. Determine the number of days past due for each of the preceding accounts. 2. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals. 3. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule. 4. Assume that the allowance for doubtful accounts for Trophy Fish Company has a debit balance of $3,600 before adjustment on December 31, 20Y6. Journalize the adjusting entry for uncollectible accounts. 5. Assuming that the adjusting entry in (4) was inadvertently omitted, how would the omission affect the balance sheet and income statement?
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter11: The Statement Of Cash Flows
Section: Chapter Questions
Problem 66.4C
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
Aging of receivables; estimating allowance for doubtful accounts Trophy Fish Company supplies flies and fishing gear to sporting goods stores and outfitters throughout the western United States. The accounts receivable clerk for Trophy Fish prepared the following partially completed aging of receivables schedule as of the end of business on December 31, 20Y6:
Transcribed Image Text:A
H
Not
Days Past Due
Past
Customer
4 AAA Outfitters
5 Brown Trout Fly Shop
Balance
Due
1-30
31-60
61-90
91-120 Over 120
20,000 20,000
7,500
7,500
30 Zigs Fish Adventures
31 Subtotals
4,000
| 1,300,000 750,000 290,000 120,000 40,000 20,000 80,000
4,000
The following accounts were unintentionally omitted from the aging
schedule:
Customer
Due Date
Balance
Adams Sports & Flies
May 22, 20Y6 $5,000
Blue Dun Flies
Oct. 10, 20Y6 4,900
Cicada Fish Co.
Sept. 29, 20Y6 8,400
Deschutes Sports
Oct. 20, 20Y6 7,000
Green River Sports
Nov. 7, 20Y6
3,500
Smith River Co.
Nov. 28, 20Y6 2,400
Western Trout Company Dec. 7, 20Y6
6,800
Wolfe Sports
Jan. 20, 20Y 7| 4,400
Transcribed Image Text:Trophy Fish has a past history of uncollectible accounts by age category,
as follows:
Age Class
Not past due
Percent Uncollectible
19%
|1-30 days past due
2
31-60 days past due
10
61-90 days past due
30
91-120 days past due
40
Over 120 days past due 80
Instructions
1. Determine the number of days past due for each of the
preceding accounts.
2. Complete the aging of receivables schedule by adding the
omitted accounts to the bottom of the schedule and updating the
totals.
3. Estimate the allowance for doubtful accounts, based on the
aging of receivables schedule.
4. Assume that the allowance for doubtful accounts for Trophy Fish
Company has a debit balance of $3,600 before adjustment on
December 31, 20Y6. Journalize the adjusting entry for uncollectible
accounts.
5. Assuming that the adjusting entry in (4) was inadvertently
omitted, how would the omission affect the balance sheet and
income statement?
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