Answered step by step
Verified Expert Solution
Question
00
1 Approved Answer
4 Page 986912 E511 Mercy Hospital has the following balances on December 31, 2010, before any adjusting entries: Accounts receivable = $60,000; Allowance for uncollectible
4 Page 986912 E511 Mercy Hospital has the following balances on December 31, 2010, before any adjusting entries: Accounts receivable = $60,000; Allowance for uncollectible accounts = $1,500 (credit). Mercy estimates uncollectible accounts based on an aging of accounts receivable as shown below. OIOS.IE todm999 oldsvis991 A Estimated (119 0001 OTOCIE 19dm999 m s sIdiootloom 101 s wollA Amount Percent hetis Age Group Receivable Uncollectible 2 w as slalom 101 Ydre gaiteibs od b10991 Not yet due $40,000 10% batallos donwoldsvisot too fastsaties 0-30 days past due 10,000 20% 5 dias on 101 o gnituba od bro 31-90 days past due 7,000 50% solo ed ones iboto lo More than 90 days past due 3.000 90% s ob s tos) Total $60,000 tonno 150 di sini Required: 1. Estimate the amount of uncollectible receivables. 2. Record the adjusting entry for uncollectible accounts on December 31, 2010. 3. Calculate the net realizable value of accounts receivable. 4. How would the problem change if Mercy had Sales of $2.5 million and estimated the value of bad debt as 2.3% of sales
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started