Performance Bike Co. is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31 and a historical analysis of the percentage of uncollectible accounts in each age category are as follows: Estimate the proper balance of the allowance for doubtful accounts should be as of December 31. Performance Bike Co. Estimation of Uncollectible Accounts December 31 Estimated Uncollectible Estimated Uncollectible Age Interval Balance Accounts Percent Accounts Amount Not past due $750,000 1/2% 1-30 days past due 82,500 4 31-60 days past due 37,500 61-90 days past due 27,000 15 91-180 days past due 19,500 39 Over 180 days past due 14,300 70 Total $930,800

Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter14: Accounting For Uncollectible Accounts Receivable
Section14.1: Uncollectible Accounts Receivable
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Estimating Doubtful Accounts
Performance Bike Co. is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31 and a historical analysis of the percentage of uncollectible accounts in each age category are as follows:
Estimate the proper balance of the allowance for doubtful accounts should be as of December 31.
Performance Bike Co.
Estimation of Uncollectible Accounts
December 31
Estimated Uncollectible
Estimated Uncollectible
Age Interval
Balance
Accounts Percent
Accounts Amount
Not past due
$750,000
1/2%
1-30 days past due
82,500
4
31-60 days past due
37,500
7
61-90 days past due
27,000
15
91-180 days past due
19,500
39
Over 180 days past due
14,300
70
Total
$930,800
Transcribed Image Text:Estimating Doubtful Accounts Performance Bike Co. is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31 and a historical analysis of the percentage of uncollectible accounts in each age category are as follows: Estimate the proper balance of the allowance for doubtful accounts should be as of December 31. Performance Bike Co. Estimation of Uncollectible Accounts December 31 Estimated Uncollectible Estimated Uncollectible Age Interval Balance Accounts Percent Accounts Amount Not past due $750,000 1/2% 1-30 days past due 82,500 4 31-60 days past due 37,500 7 61-90 days past due 27,000 15 91-180 days past due 19,500 39 Over 180 days past due 14,300 70 Total $930,800
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