{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

# Chapter 5 Bad Debt Examples - beginning balance in the...

This preview shows pages 1–2. Sign up to view the full content.

1. Luci uses the Aging of Receivables method to calculate bad debt and has a beginning balance in the Allowance account of \$10,000 (debit). Given the following information about their receivables, what is bad debt expense and the ending balance in the Allowance Account? Amount Age % bad \$200,000 0-30 days 1 % \$ 45,000 31-60 days 5 % \$ 15,000 61-90 days 20 % \$ 8,000 90+ days 30 % 2. Carter uses the % of sales method to calculate bad debt expense and has a beginning balance in the Allowance account of \$2,000 (credit). They estimate that 6% of their \$500,000 in sales will be uncollectible. What is the bad debt expense and the ending balance in the Allowance account? 3. Macon uses the aging method to calculate bad debt expense and has a

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: beginning balance in the allowance account BEFORE ANY ADJUSTMENTS of \$15,000 (credit). During the year they wrote off \$10,000 in bad debt and recovered \$5,000 in previously written off bad debt. They estimate that \$12,000 of their \$300,000 in receivables will prove to be uncollectible. What is bad debt expense, the ending balance in the allowance account, and the net realizable value of their accounts receivable? Bad Debt Expense Examples 4. Angus has the following information available: 12/31/2008 12/31/2007 A/R \$2,000,000 \$2,550,000 Net Sales for 2008, all credit, were \$31,850,000. a. What was Angus’ A/R turnover for 2008? b. What was Angus’ Days in Receivable for 2008?...
View Full Document

{[ snackBarMessage ]}

### Page1 / 2

Chapter 5 Bad Debt Examples - beginning balance in the...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online