NCOLLECTIBLE ACCOUNTS-AGING OF ACCOUNTS RECEIVABLE
Tallahassee Seminole Shop uses the percentage of receivables method of accounting for uncollectible accounts. An analysis of the accounts receivable ledger at the end of 20-9 reveals the following data concerning specific customers:
Invoice Dates and Amounts of Customers Unpaid Invoices
|
Borthick, A.
|
10/7
|
$2,300
|
11/15
|
$1,200
|
12/18
|
$3,000
|
|
Clark, R.
|
6/1
|
1,200
|
8/15
|
2,500
|
|
|
|
Copley, P.
|
9/23
|
4,500
|
10/22
|
2,300
|
12/23
|
2,800
|
|
Davis, H.
|
12/15
|
1,500
|
|
|
|
|
|
Heagy, C.
|
9/9
|
200
|
|
|
|
|
|
O'Keefe, S.
|
11/20
|
3,300
|
12/10
|
1,400
|
|
|
|
Pasewark, W.
|
12/2
|
5,500
|
|
|
|
|
|
Schroeder, M.
|
12/15
|
2,300
|
|
|
|
|
|
Shockley, W.
|
11/18
|
800
|
12/8
|
3,000
|
|
|
|
Wilkerson, J.
|
8/21
|
300
|
11/15
|
1,100
|
12/8
|
1,700
|
At December 31, 20-9, the unadjusted balance in Allowance for Doubtful Accounts is a debit of $500. All sales are billed n/30. The chart below is used to estimate the uncollectibles using the aging of receivables method.
Days Past Due Uncollectible Percen
Not yet due...............................................................2%
1-30 days .................................................................4
31-60 days ...............................................................8
61-90 days ...............................................................16
Over 90 days ............................................................32
Required:
1. Prepare an aging schedule.
2. Estimate the uncollectible accounts as of the end of 20-9.
3. Prepare the adjusting entry for uncollectible accounts.