Presented below is an aging schedule for Halleran Company at December 31, 2023: Instructions a. Prepare T

Question:

Presented below is an aging schedule for Halleran Company at December 31, 2023:


Instructions

a. Prepare T accounts for Accounts Receivable and Allowance for Doubtful Accounts and enter the 2023 unadjusted balances.

b. Prepare and post the adjusting entry for uncollectibles at December 31, 2023.

c. Prepare and post the entries for these selected 2024 events and transactions. 1. March 31, a $1,000 customer balance originating in 2023 is judged uncollectible. 2. May 31, a cheque for $1,000 is received from the customer whose account was written off as uncollectible on March 31.

d. Prepare the adjusting entry for uncollectibles on December 31, 2024, assuming that the unadjusted balance in Allowance for Doubtful Accounts is a debit of $800 and the aging schedule indicates that total estimated uncollectibles will be $31,600.

Taking It Further 

Companies often have large amounts of accounts receivable that can lead to large losses from uncollectible accounts. What credit policies could Halleran Company put in place to minimize the amount of bad debts?

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Related Book For  book-img-for-question

Accounting Principles Volume 1

ISBN: 9781119786818

9th Canadian Edition

Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak

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