net zero products, a wholesaler of sustainable raw materials, prepares the following aging of receivables…
net zero products, a wholesaler of sustainable raw materials, prepares the following aging of receivables analysis. complete this question by entering your answers in the tabs below. prepare the adjusting entry to record bad debts expense assuming the unadjusted balance in the allowance for doubtful accounts is a $2,500 credit. journal entry worksheet record estimated bad debts assuming that allowance for doubtful accounts has a $2,500 credit balance. note: enter debits before credits.
Answer
Explanation:
Step1: Calculate uncollectible amount for each category
For 0 days past - due: $95800\times1%= 95800\times0.01 = 958$ For 1 - 30 days past - due: $33000\times2%=33000\times0.02 = 660$ For 31 - 60 days past - due: $14500\times4%=14500\times0.04 = 580$ For 61 - 90 days past - due: $11500\times6%=11500\times0.06 = 690$ For over 90 days past - due: $13500\times10%=13500\times0.1 = 1350$
Step2: Calculate total estimated uncollectible amount
$958 + 660+580 + 690+1350=4238$
Step3: Calculate bad - debts expense
The unadjusted balance in the Allowance for Doubtful Accounts is a $2500$ credit. Bad - debts expense = Total estimated uncollectible amount−Unadjusted credit balance of Allowance for Doubtful Accounts Bad - debts expense = $4238 - 2500=1738$
Answer:
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| December 31 | Bad Debts Expense | $1738$ | |
| Allowance for Doubtful Accounts | $1738$ |