ACC101 M9285 INTRODUCTION TO FINANCIAL ACCOUNTING Question Part-A East & West Trading Enterprises reports the following information pertaining to its accounts receivable: Current Days Past Due 1-30 31-60 61-90 Over 90 RS 250,000 RS 90,000 Rs 70,000 RS 20,000 RS 10,000 The company's credit department provided the following estimates regarding the percent of accounts expected to eventually be written off from each category listed above: Current receivables outstanding. 1% Receivables 1-30 days past due. 5% Receivables 31-60 days past due 10% Receivables 61-90 days past due, 25% Receivables over 90 days past due. The company uses a balance sheet approach to estimate credit losses. The company's financial years ends on 30-June-2019 75% Instructions: a) Record the company's uncollectible accounts expense, assuming it has a Rs.2.500 credit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. b) Record the company's uncollectible accounts expense, assuming it has a Rs.2.000 debit balance in its Allowance for Doubtful Accounts prior to making the necessary adjustment. Question Part-B On February 10, 2018 Fancy Dressing Associate learned that an account receivable of Rs.25,200, is worthless because of the bankruptcy of the client viz., Dramatic Performance Company. This account was originated on October 15, 2017 Instructions: Prepare the journal entry required on February 10, 2018 to write off this account a) Using "Direct Write-off Method" b) Using "Allowance Method" Question Part-c Faraz Fabrics wrote off a Rs.7,500 account receivable from a customer Badshah Khan on March 16, 2018 Badshah Khan, paid the account in full on April 27,2018 Instructions: Prepare the journal entry(ies) to record the collection of amount from Badshah Khan on April 27, 2018. Page 1 of 1