Preparing an Aging Schedule to Estimate Allowance for Doubtful Accounts A review of open invoices of Sketchers Inc. results in the following report. Invoice Amount Date (Each from this year) #496 $458.48 5-Dec #495 685.77 2-Dec #427 274.16 5-Nov #100 109.06 28-Jun #300 741.43 3-Oct #410 670.26 31-Oct #204 62.69 25-Aug #498 760.84 28-Dec #499 276.15 28-Dec #487 747.28 28-Nov #310 207.65 8-Oct #178 643.21 7-Aug #497 335.03 5-Dec #488 142.90 29-Nov #105 18.73 5-Jul $6,133.64 Required a. Organize the list of open invoices as of December 31 into a table with the following aging categories across the top: (1) less than 30 days, (2) 31-60 days, (3) 60-90 days, and (4) greater than 90 days. b. Assume that the company estimates the allowance for doubtful accounts based upon the following percentages applied to the appropriate aging categories: (1) 1% for less than 30 days, (2) 5% for 31-60 days, (3) 30% for 60-90 days, and (4) 60% for greater than 90 days. What is the ending allowance for doubtful accounts as estimated by the company? Complete the following table to complete requirements of parts a and b. Note: For each of the dollar amounts that you enter into the table below, round to two digits after the decimal; for example, enter 1.42 for 1.424, or 1.43 for 1.425. Less than 30 days 31-60 Days 60-90 Days Greater than 90 Days Total Total Receivables Answer Answer Answer Answer Answer Percentage Answer Answer Answer Answer Estimated Uncollectibles Answer Answer Answer Answer Answer

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 69E: Aging Receivables and Bad Debt Expense Perkinson Corporation sells paper products to a large number...

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Question

Preparing an Aging Schedule to Estimate Allowance for Doubtful Accounts

A review of open invoices of Sketchers Inc. results in the following report.

Invoice	Amount	Date (Each from this year)
#496	$458.48	5-Dec
#495	685.77	2-Dec
#427	274.16	5-Nov
#100	109.06	28-Jun
#300	741.43	3-Oct
#410	670.26	31-Oct
#204	62.69	25-Aug
#498	760.84	28-Dec
#499	276.15	28-Dec
#487	747.28	28-Nov
#310	207.65	8-Oct
#178	643.21	7-Aug
#497	335.03	5-Dec
#488	142.90	29-Nov
#105	18.73	5-Jul
	$6,133.64

Required

a. Organize the list of open invoices as of December 31 into a table with the following aging categories across the top: (1) less than 30 days, (2) 31-60 days, (3) 60-90 days, and (4) greater than 90 days.

b. Assume that the company estimates the allowance for doubtful accounts based upon the following percentages applied to the appropriate aging categories: (1) 1% for less than 30 days, (2) 5% for 31-60 days, (3) 30% for 60-90 days, and (4) 60% for greater than 90 days. What is the ending allowance for doubtful accounts as estimated by the company?

Complete the following table to complete requirements of parts a and b.

Note: For each of the dollar amounts that you enter into the table below, round to two digits after the decimal; for example, enter 1.42 for 1.424, or 1.43 for 1.425.