Estimating Doubtful Accounts Easy Rider International is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31, 20Y3, and a historical analysis of the percentage of uncollectible accounts in each age category are as follows: Age Interval Balance PercentUncollectible Not past due $342,200 1 % 1–30 days past due 127,600 5 31–60 days past due 52,200 25 61–90 days past due 29,000 35 91–180 days past due 29,000 50 Over 180 days past due 19,200 70 $599,200 Estimate what the balance of the allowance for doubtful accounts should be as of December 31, 20Y3. Enter your answers as positive amounts. Age Interval EstimatedUncollectibleAmount Not past due $ 1-30 days past due 31-60 days past due 61-90 days past due 91-180 days past due Over 180 days past due Total $
Bad Debts
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.
Estimating Doubtful Accounts
Easy Rider International is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31, 20Y3, and a historical analysis of the percentage of uncollectible accounts in each age category are as follows:
| Age Interval | Balance | Percent Uncollectible |
||||||
| Not past due | $342,200 | 1 | % | |||||
| 1–30 days past due | 127,600 | 5 | ||||||
| 31–60 days past due | 52,200 | 25 | ||||||
| 61–90 days past due | 29,000 | 35 | ||||||
| 91–180 days past due | 29,000 | 50 | ||||||
| Over 180 days past due | 19,200 | 70 | ||||||
| $599,200 |
Estimate what the balance of the allowance for doubtful accounts should be as of December 31, 20Y3. Enter your answers as positive amounts.
Age Interval |
Estimated Uncollectible Amount |
| Not past due | $ |
| 1-30 days past due | |
| 31-60 days past due | |
| 61-90 days past due | |
| 91-180 days past due | |
| Over 180 days past due | |
| Total | $ |
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
