An aging analysis of Hagiwara Company's accounts receivable at December 31, 2016 and 2017, showed the following:

Additional information:
1. At December 31, 2016, the unadjusted balance in Allowance for Doubtful Accounts was a credit of $6,600.
2. In 2017, $23,500 of accounts was written off as uncollectible and $2,200 of accounts previously written off was collected.
Instructions
(a) Prepare an aging schedule to calculate the estimated uncollectible accounts at December 31, 2016, and at December 31, 2017.
(b) Calculate the net realizable value of Hagiwara's accounts receivable at December 31, 2016, and December 31, 2017.
(c) Record the following:
1. The adjusting entry on December 31, 2016
2. The write off of uncollectible accounts in 2017
3. The collection in 2017 of accounts previously written off
4. The adjusting entry on December 31, 2017
Taking It Further
What are the implications of the changes in the age of the receivables from 2016 to 2017?

Transcribed Image Text:

Number of Days Outstanding Estimated % Accounts Receivable 2017 ding Uncollectible 2016 0-30 days 31-60 days 61-90 days Over 90 days Total 3% 6% 12% 25% $115,000 35,000 45,000 80,000 $275,000 $145,000 63,000 38,000 24,000 $270,000