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 uncol- lectible accounts in each age category are as follows: Percent Uncollectible Age Interval Balance $3,250,000 Not past due 0.8% 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 1,050,000 2.4 780,000 7.0 18.0 320,000 240,000 34.0 150,000 85.0 $5,790,000 Estimate the proper balance of the allowance for doubtful accounts as of December 31.

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 uncol- lectible accounts in each age category are as follows: Percent Uncollectible Age Interval Balance $3,250,000 Not past due 0.8% 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 1,050,000 2.4 780,000 7.0 18.0 320,000 240,000 34.0 150,000 85.0 $5,790,000 Estimate the proper balance of the allowance for doubtful accounts as of December 31.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter18: The Management Of Accounts Receivable And Inventories

Section: Chapter Questions

Problem 9P

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Casebolt Company wrote off the following accounts receivable as uncollectible for the first year of its operations ending December 31: a. Journalize the write-offs under the direct write-off method. b. Journalize the write-offs under the allowance method. Also, journalize the adjusting entry for uncollectible accounts. The company recorded 5,250,000 of credit sales during the year. Based on past history and industry averages, % of credit sales are expected to be uncollectible. c. How much higher (lower) would Casebolt Companys net income have been under the direct write-off method than under the allowance method?
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 uncol- lectible accounts in each age category are as follows: Percent Uncollectible Age Interval Balance $3,250,000 Not past due 0.8% 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 1,050,000 2.4 780,000 7.0 18.0 320,000 240,000 34.0 150,000 85.0 $5,790,000 Estimate the proper balance of the allowance for doubtful accounts as of December 31.
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 uncol-lectible accounts in each age category are as follows: Age interval Balance percent uncollectible __________________________________________________________________________________ Not past due $3,250,000 0.8% 1-30 day past due 1,050,000 2.4 31-60 day past due 780,000 7.0 61-90 day past due 320,000 18.0 91-180 day past due 240,000 34.0 over 180 day past due 150,000 85.0 $5,790,000 Estimate the proper balance of…
Outlaw 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: Age Interval Balance Percent Uncollectible Not past due $1,370,000 0.50% 1 - 30 days past due 530,600 3 31 - 60 days past due 174,800 8 61 - 90 days past due 67,100 14 91 - 180 days past due 33,000 44 Over 180 days past due 27,000 83 $2,202,500 Estimate what the proper balance of the Allowance for Doubtful Accounts should be as of December 31. Estimated Uncollectible Accounts Age Interval Balance Percent Amount Not past due $1,370,000 0.50% 1 - 30 days past due 530,600 3% 31 - 60 days past due 174,800 8% 61 - 90 days past due 67,100 14% 91 - 180 days past due 33,000 44% Over 180 days past due 27,000 83% Total $2,202,500
Outlaw 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 given below. Estimated Uncollectible Estimated Uncollectible Age Interval Balance Accounts Percent Accounts Amount Not past due $500,000 3/4 % $3,750 1-30 days past due 55,000 4 2,200 31-60 days past due 25,000 6 1,500 61-90 days past due 18,000 14 2,520 91-180 days past due 13,000 42 5,460 Over 180 days past due 9,500 70 6,650 Total $620,500 $22,080 Assume that the allowance for doubtful accounts for Outlaw Bike Co. had a debit balance of $3,975 as of December 31. Journalize the adjusting entry for uncollectible accounts as of December 31.
Outlaw 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: Age Class 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 Age Class Not past due 1-30 days past due 31-60 days past due 61-90 days past due Balance $578,000 63,600 28,900 20,800 15,000 11,000 $717,300 91-180 days past due Over 180 days past due Total Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31. Estimated Estimated Percent Uncollectible 1/2% 3 7 16 Balance $578,000 63,600 28,900 20,800 15,000 11,000 $717,300 42 75 Uncollectible Accounts Uncollectible Accounts Amount Percent 1/2% 3 7 16 42 75
Outlaw 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: Age Class 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 Balance Age Class 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 $892,000 98,100 44,600 32,100 23,200 16,900 $1,106,900 Balance $892,000 98,100 44,600 32,100 23,200 16,900 $1,106,900 Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31. Percent Uncollectible 4 6 18 1/2 % 4 Percent Uncollectible 1/2% 42 6 80 18 42 80 Estimated Uncollectible Accounts Amount
Outlaw 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: Age Class Balance Percent Uncollectible Not past due $760,000 1/2 % 1–30 days past due 83,600 3 31-60 days past due 38,000 8 61–90 days past due 27,400 15 91–180 days past due 19,800 42 Over 180 days past due 14,400 80 $943,200 Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31. Please fill in answers for the "estimated uncollectible accounts amount" Age Class Balance PercentUncollectible Estimated UncollectibleAccounts Amount Not past due $760,000 1/2% 1-30 days past due 83,600 3 31-60 days past due 38,000 8 61-90 days past due 27,400 15 91-180 days past due 19,800 42 Over 180 days past due 14,400 80 Total $943,200
Estimating doubtful accountsPerformance Bike Co. is a wholesaler of motorcycle supplies. An aging ofthe company's accounts receivable on December 31 and a historicalanalysis of the percentage of uncollectible accounts in each age category are as follows: Age Interval Balance Percent Uncollectible Not past due1-30 days past due31-60 days past due61-90 days past due91-180 days past dueOver 180 days past due $3,250,0001,050,000780,000320,000240,000150,000 0.8%2.47.018.034.085.0 $5, 790,000 Estimate the proper balance of the allowance for doubtful accounts as ofDecember 31.
Entry for Uncollectible Accounts Outlaw 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 given below. Age Interval Balance Estimated UncollectibleAccounts Percent Estimated UncollectibleAccounts Amount Not past due $500,000 3/4 % $3,750 1-30 days past due 55,000 4 2,200 31-60 days past due 25,000 6 1,500 61-90 days past due 18,000 14 2,520 91-180 days past due 13,000 42 5,460 Over 180 days past due 9,500 70 6,650 Total $620,500 $22,080 Assume that the allowance for doubtful accounts for Outlaw Bike Co. had a debit balance of $3,975 as of December 31. Journalize the adjusting entry for uncollectible accounts as of December 31.
Entry for Uncollectible Accounts Outlaw 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 given below. Age Interval Balance Estimated UncollectibleAccounts Percent Estimated UncollectibleAccounts Amount Not past due $892,000 3/4 % $6,690 1-30 days past due 285,000 1.00 2,850 31-60 days past due 101,000 8.00 8,080 61-90 days past due 63,000 16.00 10,080 91-180 days past due 43,100 50.00 21,550 Over 180 days past due 17,700 80.00 14,160 Total $1,401,800 $63,410 Assume that the allowance for doubtful accounts for Outlaw Bike Co. had a debit balance of $5,140 as of December 31. Journalize the adjusting entry for uncollectible accounts as of December 31. If an amount box does not require an entry, leave it blank.
Entry for Uncollectible Accounts Outlaw 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 given below. Age Interval Balance Estimated UncollectibleAccounts Percent Estimated UncollectibleAccounts Amount Not past due $878,000 3/4 % $6,585 1-30 days past due 96,600 2 1,932 31-60 days past due 43,900 8 3,512 61-90 days past due 31,600 14 4,424 91-180 days past due 22,800 38 8,664 Over 180 days past due 16,700 75 12,525 Total $1,089,600 $37,642 Assume that the allowance for doubtful accounts for Outlaw Bike Co. had a debit balance of $6,775 as of December 31. Journalize the adjusting entry for uncollectible accounts as of December 31. If an amount box does not require an entry, leave it blank. Dec. 31 - Select - - Select - - Select - - Select -