Accounting and governance

Accounting for receivables

Answers for PSA 7.6

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SA7.6 Journalise transactions related to bad debts. 08 The following is an accounts receivable ageing schedule for Chin Ltd. Number of days past due Not yet Over Customer Total due 1-30 31-60 61-90 90 Lee 10 000 $12 000 22 000 Lu Sing Wong Others 40000$ 40 000 57 000 16000 6000 34 535 000 126 00 96000 | 16000| 14000 279 0001 152 000 2 000| 26000| 35000| 34000 Estimated percentage uncollectable 4% 1396| 25% 50% $6080 | s2240 | $3380 | S8750 | $ 7000 Total estimated bad debts 37 450 At 31 December 2019 the unadjusted balance in Allowance for Doubtful Debts is a credit of $12 000. Required a. Journalise and post the adjusting entry for bad debts at 31 December 2019 Journalise and post to the allowance account these 2020 events and transactions. (Use running-balance format.) 1. 31 March, a $500 customer balance originating in 2020 is determined to be b. uncollectable. 2. 31 May, a cheque for $500 is received from the customer whose account was written off as uncollectable on 31 March. Journalise the adjusting entry for bad debts at 31 December 2020, assuming that the unadjusted balance in allowance for doubtful debts is a debit of $800 and the ageing schedule indicates that total estimated bad debts will be 30 300. c. SA7.6 Journalise transactions related to bad debts. 08 The following is an accounts receivable ageing schedule for Chin Ltd. Number of days past due Not yet Over Customer Total due 1-30 31-60 61-90 90 Lee 10 000 $12 000 22 000 Lu Sing Wong Others 40000$ 40 000 57 000 16000 6000 34 535 000 126 00 96000 | 16000| 14000 279 0001 152 000 2 000| 26000| 35000| 34000 Estimated percentage uncollectable 4% 1396| 25% 50% $6080 | s2240 | $3380 | S8750 | $ 7000 Total estimated bad debts 37 450 At 31 December 2019 the unadjusted balance in Allowance for Doubtful Debts is a credit of $12 000. Required a. Journalise and post the adjusting entry for bad debts at 31 December 2019 Journalise and post to the allowance account these 2020 events and transactions. (Use running-balance format.) 1. 31 March, a $500 customer balance originating in 2020 is determined to be b. uncollectable. 2. 31 May, a cheque for $500 is received from the customer whose account was written off as uncollectable on 31 March. Journalise the adjusting entry for bad debts at 31 December 2020, assuming that the unadjusted balance in allowance for doubtful debts is a debit of $800 and the ageing schedule indicates that total estimated bad debts will be 30 300. c