7.10

Estimating Allowance for Doubtful Accounts Evers Industries has a past history of uncollectible accounts, as follows. Age Class Percent Uncollectible Not past due 1 % 1-30 days past due 3 31-60 days past due 12 61-90 days past due 30 Over 90 days past due 75 Estimate the allowance for doubtful accounts, based on the aging of receivables information provided in the chart below. Evers Industries Estimate of Allowance for Doubtful Accounts Not Past Days Past Days Past Balance Days Past Days Past Due Due 1-30 Due 31-60 Due 61-90 Due Over 90 1,124,500 607,400 233,000 121,600 96,500 66,000 1% 3% 12% 30% 75% Total receivables Percentage uncollectible Allowance for doubtful accounts Determine Due Date and Interest on Notes Determine the due date and the amount of interest due at maturity on the following notes: Date of Note Face Amount Interest Rate Term of Note a. January 5 * $90,000 6% 120 days b. February 15 * 24,000 4 30 days c. May 19 65,000 8 45 days d. August 20 32,800 5 90 days e. October 19 46,000 7. 90 days * Assume a leap year in which February has 29 days. Assume 360 days in a year when computing the interest. Note Due Date Interest (a) $ (b) $ (C) $ (d) $ (e)