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Please Solve all parts and Do not give Image format

Please Solve all parts and Do not give Image format

Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter9: Accounting For Receivables
Section: Chapter Questions
Problem 9PB: Elegant Linens uses the balance sheet aging method to account for uncollectible debt on receivables....
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You are an accountant at Company XYZ, which has a fiscal year ending on December 31. It is now December 31, 2022, and you are getting ready to record the adjusting journal entry for this year's bad debt expense. The credit department has prepared for you a list of your accounts receivables with their respective ages. Accounts Receivable as of 12/31/2022 A B C D E F Status Amounts Age $98,000 Not yet due $35,000 Not yet due $48,000 5 days past due $27,000 33 days past due Not yet due 1-30 days past due 31-90 days past due 91 180 days past due > 180 days past due $12,000 $5,000 The credit department estimates the following percentage of uncollectible accounts receivable by age: Estimated % Uncollectible A/R 68 days past due 400 days past due 1% 2.50% 10% 75% 95% You then inspect the accounting records for the year and note that during 2022, the company had write-offs of $12,400 and recoveries of $800. The beginning of the year's Allowance for Doubtful Accounts (AFDA) had a credit balance of $8,130 (as of 01/01/2022). You also note that total credit sales during 2022 were $820,000. The credit department informs you that historically, 1.65% of credit sales have proven to be uncollectible.
Transcribed Image Text:You are an accountant at Company XYZ, which has a fiscal year ending on December 31. It is now December 31, 2022, and you are getting ready to record the adjusting journal entry for this year's bad debt expense. The credit department has prepared for you a list of your accounts receivables with their respective ages. Accounts Receivable as of 12/31/2022 A B C D E F Status Amounts Age $98,000 Not yet due $35,000 Not yet due $48,000 5 days past due $27,000 33 days past due Not yet due 1-30 days past due 31-90 days past due 91 180 days past due > 180 days past due $12,000 $5,000 The credit department estimates the following percentage of uncollectible accounts receivable by age: Estimated % Uncollectible A/R 68 days past due 400 days past due 1% 2.50% 10% 75% 95% You then inspect the accounting records for the year and note that during 2022, the company had write-offs of $12,400 and recoveries of $800. The beginning of the year's Allowance for Doubtful Accounts (AFDA) had a credit balance of $8,130 (as of 01/01/2022). You also note that total credit sales during 2022 were $820,000. The credit department informs you that historically, 1.65% of credit sales have proven to be uncollectible.
a) Suppose that XYZ company uses the aging method of estimating uncollectible accounts. What is the amount of bad debt expense for 2022? Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar. b) Using the aging method of estimating uncollectible accounts, what is the ending balance for the Allowance for Doubtful Accounts for 2022? Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar. c) Suppose that XYZ company uses the percent of sales method to estimate uncollectible accounts. What is the amount of bad debt expense for 2022? Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar. d) Suppose that XYZ company uses the percent of sales method to estimate uncollectible accounts. What is the ending balance for the Allowance for Doubtful Accounts for 2022? Assume that the beginning balance for Allowance for Doubtful Accounts is the same for either the aging method or the percent of sales method. Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar.
Transcribed Image Text:a) Suppose that XYZ company uses the aging method of estimating uncollectible accounts. What is the amount of bad debt expense for 2022? Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar. b) Using the aging method of estimating uncollectible accounts, what is the ending balance for the Allowance for Doubtful Accounts for 2022? Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar. c) Suppose that XYZ company uses the percent of sales method to estimate uncollectible accounts. What is the amount of bad debt expense for 2022? Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar. d) Suppose that XYZ company uses the percent of sales method to estimate uncollectible accounts. What is the ending balance for the Allowance for Doubtful Accounts for 2022? Assume that the beginning balance for Allowance for Doubtful Accounts is the same for either the aging method or the percent of sales method. Use the following numeric format 12345 (no dollar signs or commas). Round to the nearest dollar.
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