Question

# Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following...

Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis.

 Days Past Due Total 0 1 to 30 31 to 60 61 to 90 Over 90 Accounts receivable \$ 645,000 \$ 411,000 \$ 105,000 \$ 51,000 \$ 33,000 \$ 45,000 Percent uncollectible 1 % 2 % 5 % 7 % 10 %

a. Complete the below table to calculate the estimated balance of Allowance for Doubtful Accounts using the aging of accounts receivable method.
b. Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a \$5,100 credit.
c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a \$1,600 debit.

a. Complete the below table to calculate the estimated balance of Allowance for Doubtful Accounts using the aging of accounts receivable method.

 Total 0 1 to 30 31 to 60 61 to 90 Over 90 Account receivable 645000 411000 105000 51000 33000 45000 Percent uncollectibles 1% 2% 5% 7% 10% Uncollectible amount 15570 4110 2100 2550 2310 4500

a) Estimated balance of allowance for doubtful accountss = \$15570

 Date account and explanation debit credit Bad debt expense (15570-5100) 10470 Allowance for doubtful accounts 10470 (To record adjusting entry)

 Date account and explanation debit credit Bad debt expense (15570+1600) 17170 Allowance for doubtful accounts 17170 (To record adjusting entry)