3. Goo Sportswear, Ltd. develops an aged schedule of accounts receivable at the end of each year. (Click the icon to view the schedule of accounts receivable.) The company estimated an allowance for uncollectible accounts based on the following estimates: 2 (Click the icon to view the allowances provided.) After a specific review of the company's accounts receivable, Goo's credit manager decided to provide a full allowance against all Bean Brands' balances that are more than 60 days past due. The percentage allowance is applied to the 61-90 days and over 90 days past due aging categories only after deducting the balances due from Bean Brands 3(Click the icon to view additional information.) Read the requirements Requirement a. Compute the balance required in the allowance for uncollectible accounts at year-end. Round up to the nearest dollar. (For entries with a $0 balance, make sure to enter "0" in the appropriate column. Use a minus sign or parentheses for any amounts to be subtracted. Round your answers to the nearest whole dollar.) Goo's Sportswear: Aged Schedule of Accounts Receivable Past Due 1-30 Over 90 31-60 Days 61-90 Days Current Days Days Totals Totals Specific review Net balance Allowance % % % % % Allowance needed Specific accounts 61-90 days Specific accounts over 90 days Allowance needed Requirement b. Prepare the journal entry to record the bad debt provision for the current year. (Record debits first, then credits. Exclude explanations from any journal entries.) Print Account Current Year (1) (2) (3) (4) Requirement c. Independent of your answer to part (b), prepare the journal entry to record the bad debt provision for the current year assuming that the allowance for uncollectible accounts had a $329,000 debit balance. (Record debits first, then credits. Exclude explanations from any journal entries.) Account Current Year (5) (6) (7) (8) Requirement d. In the following year, Goo's credit management decided to write off all accounts that were over 90 days past due. Prepare the journal entry. (Record debits first, then credits. Exclude explanations from any journal entries. Prepare a compound entry) Current Year Account (9) (10) (11) |(12) Print Requirement e. After the write-offs recorded in part (d), assume that Cathy Clothing pays the entire balance due. Prepare the journal entries required to record the subsequent recovery of the Cathy Clothing receivables. debits first, then credits. Exclude explanations from any journal entries.) Begin by recording the entry to reinstate the account balance for Cathy Clothing that was previously written off. Do not record the cash collection. We will prepare that in the following step. Account Current Year (13) (14) (15) (16) Next record the cash collection from Cathy Clothing of the amounts previously written off. Do not record the cash collection of the remaining receivables. We will do that in the following step- Account Current Year (17) (18) (19) (20) Now record the cash collection of the remaining receivables from Cathy Clothing. Current Year Account (21) (22) (23) (24) 1: Schedule of accounts receivable Goo Sportswear: Aged Schedule of Accounts Receivable Past Due 1-30 31-60 61-90 Over 90 Customer Current Days Days Days Days Totals 145,000 $ $ 120.000 $ 25,000 665.000 183.000 $ 72,000 920,000 Rho Design Associates Min Fashions, Inc. Cathy Clothing Lovely Womensware S 410.000 $ 788.250 54,000 348.000 230.500 100.000 11,000 78,000 1.196,250 643,500 236.000 40,000 18.000 Bean Brands, Ltd $ 1,115,500 $ 297,000 $ 128,000 $ 798,000 $ Totals 804,250 $ 3.140.750 2: Allowance rules Aging Category Allowance Provided Current 496 1-30 days past due 9% 31-60 days past due 1896 61-90 days past due 45% Over 90 days past due 90% *The percentages are applied after a specific review of all accounts in these aging categories. 3: Additional Information Goo reported net credit sales of $49.000.000 for the current year. We present the company's ending balances of accounts receivable and the allowance for uncollectible accounts: Accounts Receivable Ending Balance 3,140.750 Allowance for Uncollectible Accounts 375.425 Unadjusted Ending Balance 4: Requirements a. Compute the balance required in the allowance for uncollectible accounts at year-end. Round up to the nearest dollar. b. Prepare the journal entry to record the bad debt provision for the current year. c. Independent of your answer to part (b), prepare the journal entry to record the bad debt provision for the current year assuming that the allowance for uncollectible accounts had a $329,000 debit balance. d. In the following year, Goo's credit management decided to write off all accounts that were over 90 days past due. Prepare the journal entry. e. After the write-offs recorded in part (d), assume that Cathy Clothing pays the entire balance due. Prepare the journal entries required to record the subsequent recovery of the Cathy Clothing receivables