question archive Presented below is an aging schedule for Bosworth Company

Presented below is an aging schedule for Bosworth Company

Subject:AccountingPrice:2.85 Bought3

Presented below is an aging schedule for Bosworth Company.

Customer Total Not Yet Due Number of Days Past Due
1-30 31-60 61-90 Over 90
Aneesh $?24,000   $?9,000 $15,000    
Bird ??30,000 $?30,000        
Cope ??50,000 ???5,000 ??5,000   $40,000  
DeSpears ??38,000         $38,000
Others

?120,000

??72,000

?35,000

?13,000

   
 

$262,000

$107,000

$49,000

$28,000

$40,000

$38,000

Estimated percentage uncollectible  

3%

7%

12%

24%

60%

Total estimated bad debts

$??42,400

$??3,210

$?3,430

$?3,360

$?9,600

$22,800

             

At December 31, 2013, the unadjusted balance in Allowance for Doubtful Accounts is a credit of $8,000.

Instructions

(a)  

Journalize and post the adjusting entry for bad debts at December 31, 2013. (Use T-accounts.)

(b)   Journalize and post to the allowance account these 2014 events and transactions:
Presented below is an aging schedule for Bo
 

1.  

March 1, a $600 customer balance originating in 2013 is judged uncollectible.

2.  

May 1, a check for $600 is received from the customer whose account was written off as uncollectible on March 1.
(c)  

Journalize the adjusting entry for bad debts at December 31, 2014, assuming that the unadjusted balance in Allowance for Doubtful Accounts is a debit of $1,400 and the aging schedule indicates that total estimated bad debts will be $36,700.

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a. Total Estimated Bad Debts = 42,400

Credit Balance of Allowance = 8,000

Amount required to be transferred = 42,400 - 8,000 = $34,400

Journal Entry:

Date Account Title Debit Credit
xxx Bad Debts Expenses 34,400  
  Allowance for Doubtful Debts   34,400
       

b. Journal entries:

Date Account Title Debit Credit
March 1 Allowance for Doubtful Debts 600  
  Account Receivable   600
       
May 1 Account Receivable 600  
  Allowance for Doubtful Debts   600
       
May 1 Bank 600  
  Account Receivable   600

c) Journal Entry:

Date Account Title Debit Credit
Dec31 2014 Bad Debts Expenses 38,100  
  Allowance for Doubtful Debts   38,100
       

Allowance for Doubtful Debts = 1400 + 36700 = 38,100