Uncollectible accounts using percentage-of-receivables basis

Reference no: EM131765004

Question: Menge Company has accounts receivable of $115,800 at March 31.

Month of Sale	Balance, March 31	Average Age of Receivables Outstanding
March	$75,700	16	days
February	22,200	48	days
January	9,100	73	days
Prior to January	8,800	110	days
	115,800

Credit terms are 2/10, n/30. At March 31, Allowance for Doubtful Accounts has a credit balance of $1,500 prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The company's estimate of bad debts is shown below.

Age of Accounts		Estimated Percentage Uncollectible
1-30 days		4.0%
31-60 days		5.0%
61-90 days		20.0%
Over 90 days		55.0%

Prepare the adjusting entry at March 31 to record bad debt expense.

Reference no: EM131765004

Questions Cloud

The critical path on particular project consists : The critical path on a particular project consists of 10 activities and the expected completion time on those 10 activities is 45 days.

What is the value of a put option : What is the value of a put option with strike price 45 and maturity of 5 months?

Prepare an income statement to analyze accept : What is the minimum price at which Part 524 can be sold to Belfast Company by maintaining the current level of net income

Determine the simple payback period for the project : The firm's cost of capital is 12 percent. Determine the simple payback period for the project.

Uncollectible accounts using percentage-of-receivables basis : Credit terms are 2/10, n/30. At March 31, Allowance for Doubtful Accounts has a credit balance of $1,500 prior to adjustment.

Purchasing a new flam digger : ?Aunt Bee is thinking about purchasing a new flam digger for $14,000. The expected net cash flows resulting from the digger are $10,000 in year

How low could lee bid for the charity event : How low could Lee bid for the charity event, in terms of a price per guest, and still not lose money on the event itself

Prepare the journal entry to record the purchase of bonds : Prepare the journal entry to record the purchase of bonds on January 1. Assume that the bonds are classified as available-for-sale

What dollar amount of power department costs : What dollar amount of Power Department costs will be allocated to the Maintenance Department for September

User Account

All Pages