Aging of Receivables Estimating Allowance for Doubtful Accounts Wig Creations Company supplies wigs and hair care products to beauty salons throughout Texas and the Southwest The accounts receivable clerk for Wig Creations prepared the following partially completed aging of receivables schedule as of the end of business on December 31, 20Y7 Not Days Past Due Past Customer Balance Due 1 30 31 60 61 90 91 120 Over 120 ABC Beauty 20,700 20,700 Angel Wigs 7,600 7,600 Zodiac Beauty 4,500 4,500 Subtotals 1,292,400 746,600 286,300 125,200 40,500 18,700 75,100 The following accounts were unintentionally omitted from the aging schedule Assume all due dates are for the current year except for Visions Hair Nail, which is due in the next year Customer Due Date Balance Arcade Beauty Aug 17 $4,500 Creative Images Oct 30 4,400 Excel Hair Products July 3 8,400 First Class Hair Care Sept 8 7,000 Golden Images Nov 23 3,100 Oh That Hair Nov 29 2,100 One Stop Hair Designs Dec 7 6,700 Visions Hair Nail Jan 11 4,100 Wig Creations has a past history of uncollectible accounts by age category, as follows Age Class Percent Uncollectible Not past due 1 1 30 days past due 3 31 60 days past due 9 61 90 days past due 31 91 120 days past due 39 Over 120 days past due 84 Required 1 Determine the number of days past due for each of the preceding accounts If an account is not past due, enter a zero Customer Due Date Number of Days Past Due Arcade Beauty Aug 17 fill in the blank af078afcc00c04b 1 days Creative Images Oct 30 fill in the blank af078afcc00c04b 2 days Excel Hair Products July 3 fill in the blank af078afcc00c04b 3 days First Class Hair Care Sept 8 fill in the blank af078afcc00c04b 4 days Golden Images Nov 23 fill in the blank af078afcc00c04b 5 days Oh That Hair Nov 29 fill in the blank af078afcc00c04b 6 days One Stop Hair Designs Dec 7 fill in the blank af078afcc00c04b 7 days Visions Hair Nail Jan 11 fill in the blank af078afcc00c04b 8 days Feedback Count the number of days after the due date up to December 31 Do not include the due date in your count Remember that not all months have an equal number of days 2 Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals If an amount box does not require an entry, leave it blank Wig Creations Company Aging of Receivables Schedule December 31, 20Y7 Customer Balance Not Past Due Days Past Due 1 30 Days Past Due 31 60 Days Past Due 61 90 Days Past Due 91 120 Days Past Due Over 120 ABC Beauty 20,700 20,700 Angel Wigs 7,600 7,600 Zodiac Beauty 4,500 4,500 Subtotals 1,292,400 746,600 286,300 125,200 40,500 18,700 75,100 Arcade Beauty fill in the blank b7222cfd8fb7064 1 fill in the blank b7222cfd8fb7064 2 fill in the blank b7222cfd8fb7064 3 fill in the blank b7222cfd8fb7064 4 fill in the blank b7222cfd8fb7064 5 fill in the blank b7222cfd8fb7064 6 fill in the blank b7222cfd8fb7064 7 Creative Images fill in the blank b7222cfd8fb7064 8 fill in the blank b7222cfd8fb7064 9 fill in the blank b7222cfd8fb7064 10 fill in the blank b7222cfd8fb7064 11 fill in the blank b7222cfd8fb7064 12 fill in the blank b7222cfd8fb7064 13 fill in the blank b7222cfd8fb7064 14 Excel Hair Products fill in the blank b7222cfd8fb7064 15 fill in the blank b7222cfd8fb7064 16 fill in the blank b7222cfd8fb7064 17 fill in the blank b7222cfd8fb7064 18 fill in the blank b7222cfd8fb7064 19 fill in the blank b7222cfd8fb7064 20 fill in the blank b7222cfd8fb7064 21 First Class Hair Care fill in the blank b7222cfd8fb7064 22 fill in the blank b7222cfd8fb7064 23 fill in the blank b7222cfd8fb7064 24 fill in the blank b7222cfd8fb7064 25 fill in the blank b7222cfd8fb7064 26 fill in the blank b7222cfd8fb7064 27 fill in the blank b7222cfd8fb7064 28 Golden Images fill in the blank b7222cfd8fb7064 29 fill in the blank b7222cfd8fb7064 30 fill in the blank b7222cfd8fb7064 31 fill in the blank b7222cfd8fb7064 32 fill in the blank b7222cfd8fb7064 33 fill in the blank b7222cfd8fb7064 34 fill in the blank b7222cfd8fb7064 35 Oh That Hair fill in the blank b7222cfd8fb7064 36 fill in the blank b7222cfd8fb7064 37 fill in the blank b7222cfd8fb7064 38 fill in the blank b7222cfd8fb7064 39 fill in the blank b7222cfd8fb7064 40 fill in the blank b7222cfd8fb7064 41 fill in the blank b7222cfd8fb7064 42 One Stop Hair Designs fill in the blank b7222cfd8fb7064 43 fill in the blank b7222cfd8fb7064 44 fill in the blank b7222cfd8fb7064 45 fill in the blank b7222cfd8fb7064 46 fill in the blank b7222cfd8fb7064 47 fill in the blank b7222cfd8fb7064 48 fill in the blank b7222cfd8fb7064 49 Visions Hair Nail fill in the blank b7222cfd8fb7064 50 fill in the blank b7222cfd8fb7064 51 fill in the blank b7222cfd8fb7064 52 fill in the blank b7222cfd8fb7064 53 fill in the blank b7222cfd8fb7064 54 fill in the blank b7222cfd8fb7064 55 fill in the blank b7222cfd8fb7064 56 Totals fill in the blank b7222cfd8fb7064 57 fill in the blank b7222cfd8fb7064 58 fill in the blank b7222cfd8fb7064 59 fill in the blank b7222cfd8fb7064 60 fill in the blank b7222cfd8fb7064 61 fill in the blank b7222cfd8fb7064 62 fill in the blank b7222cfd8fb7064 63 Percent uncollectible ( ) fill in the blank b7222cfd8fb7064 64 fill in the blank b7222cfd8fb7064 65 fill in the blank b7222cfd8fb7064 66 fill in the blank b7222cfd8fb7064 67 fill in the blank b7222cfd8fb7064 68 fill in the blank b7222cfd8fb7064 69 Estimate of uncollectible accounts $fill in the blank b7222cfd8fb7064 70 $fill in the blank b7222cfd8fb7064 71 $fill in the blank b7222cfd8fb7064 72 $fill in the blank b7222cfd8fb7064 73 $fill in the blank b7222cfd8fb7064 74 $fill in the blank b7222cfd8fb7064 75 $fill in the blank b7222cfd8fb7064 76 Feedback Add the accounts into the aging schedule based on their number of days past due Apply the respective uncollectible percentage to the total receivables in each days past due group and the not past due group 3 Estimate the allowance for doubtful accounts, based on the aging of receivables schedule $fill in the blank b7b7d9f6904dfb0 1 Feedback Add the accounts into the aging schedule based on their number of days past due Apply the respective uncollectible percentage to the total receivables in each days past due group and the not past due group 4 Assume that the allowance for doubtful accounts for Wig Creations has a credit balance of $3,800 before adjustment on December 31, 20Y7 Journalize the adjustment for uncollectible accounts If an amount box does not require an entry, leave it blank Dec 31 fill in the blank e385e9faefd2fe7 2 fill in the blank e385e9faefd2fe7 3 fill in the blank e385e9faefd2fe7 5 fill in the blank e385e9faefd2fe7 6 Feedback The amount of bad debt expense is affected by the balance in the allowance account 5 Assume that the adjusting entry in (4) was inadvertently omitted, how would the omission affect the balance sheet and income statement On the balance sheet, assets would be by $fill in the blank d416210defc0fea 2 because the allowance for doubtful accounts would be by $fill in the blank d416210defc0fea 4 In addition, the stockholders equity (retained earnings) would be by $fill in the blank d416210defc0fea 6 because bad debt expense would be and net income by $fill in the blank d416210defc0fea 9 on the income statement Feedback Consider the effects of a contra asset not being recorded in terms of the balance sheet equation Consider the effects of an expense not bein

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Aging of Receivables; Estimating Allowance for Doubtful Accounts Wig Creations Company supplies wigs and hair care products to beauty salons throughout Texas and the Southwest.

Aging of Receivables; Estimating Allowance for Doubtful Accounts

Wig Creations Company supplies wigs and hair care products to beauty salons throughout Texas and the Southwest. The accounts receivable clerk for Wig Creations prepared the following partially completed aging of receivables schedule as of the end of business on December 31, 20Y7:

		Not	Days Past Due
		Past
Customer	Balance	Due	1-30	31-60	61-90	91-120	Over 120
ABC Beauty	20,700	20,700
Angel Wigs	7,600			7,600

Zodiac Beauty	4,500		4,500
Subtotals	1,292,400	746,600	286,300	125,200	40,500	18,700	75,100

The following accounts were unintentionally omitted from the aging schedule. Assume all due dates are for the current year except for Visions Hair & Nail, which is due in the next year.

Customer	Due Date		Balance
Arcade Beauty		Aug. 17	$4,500
Creative Images		Oct. 30	4,400
Excel Hair Products		July 3	8,400
First Class Hair Care		Sept. 8	7,000
Golden Images		Nov. 23	3,100
Oh That Hair		Nov. 29	2,100
One Stop Hair Designs		Dec. 7	6,700
Visions Hair & Nail		Jan. 11	4,100

Wig Creations has a past history of uncollectible accounts by age category, as follows:

Age Class	Percent Uncollectible
Not past due	1	%
1-30 days past due	3
31-60 days past due	9
61-90 days past due	31
91-120 days past due	39
Over 120 days past due	84

Required:

1. Determine the number of days past due for each of the preceding accounts. If an account is not past due, enter a zero.

Customer	Due Date	Number of Days Past Due
Arcade Beauty	Aug. 17	fill in the blank af078afcc00c04b_1 days
Creative Images	Oct. 30	fill in the blank af078afcc00c04b_2 days
Excel Hair Products	July 3	fill in the blank af078afcc00c04b_3 days
First Class Hair Care	Sept. 8	fill in the blank af078afcc00c04b_4 days
Golden Images	Nov. 23	fill in the blank af078afcc00c04b_5 days
Oh That Hair	Nov. 29	fill in the blank af078afcc00c04b_6 days
One Stop Hair Designs	Dec. 7	fill in the blank af078afcc00c04b_7 days
Visions Hair & Nail	Jan. 11	fill in the blank af078afcc00c04b_8 days

Feedback

Count the number of days after the due date up to December 31. Do not include the due date in your count. Remember that not all months have an equal number of days.

2. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals. If an amount box does not require an entry, leave it blank.

Wig Creations Company
Aging of Receivables Schedule
December 31, 20Y7
Customer	Balance	Not Past Due	Days Past Due 1-30	Days Past Due 31-60	Days Past Due 61-90	Days Past Due 91-120	Days Past Due Over 120
ABC Beauty	20,700	20,700
Angel Wigs	7,600			7,600
Zodiac Beauty	4,500		4,500
Subtotals	1,292,400	746,600	286,300	125,200	40,500	18,700	75,100
Arcade Beauty	fill in the blank b7222cfd8fb7064_1	fill in the blank b7222cfd8fb7064_2	fill in the blank b7222cfd8fb7064_3	fill in the blank b7222cfd8fb7064_4	fill in the blank b7222cfd8fb7064_5	fill in the blank b7222cfd8fb7064_6	fill in the blank b7222cfd8fb7064_7
Creative Images	fill in the blank b7222cfd8fb7064_8	fill in the blank b7222cfd8fb7064_9	fill in the blank b7222cfd8fb7064_10	fill in the blank b7222cfd8fb7064_11	fill in the blank b7222cfd8fb7064_12	fill in the blank b7222cfd8fb7064_13	fill in the blank b7222cfd8fb7064_14
Excel Hair Products	fill in the blank b7222cfd8fb7064_15	fill in the blank b7222cfd8fb7064_16	fill in the blank b7222cfd8fb7064_17	fill in the blank b7222cfd8fb7064_18	fill in the blank b7222cfd8fb7064_19	fill in the blank b7222cfd8fb7064_20	fill in the blank b7222cfd8fb7064_21
First Class Hair Care	fill in the blank b7222cfd8fb7064_22	fill in the blank b7222cfd8fb7064_23	fill in the blank b7222cfd8fb7064_24	fill in the blank b7222cfd8fb7064_25	fill in the blank b7222cfd8fb7064_26	fill in the blank b7222cfd8fb7064_27	fill in the blank b7222cfd8fb7064_28
Golden Images	fill in the blank b7222cfd8fb7064_29	fill in the blank b7222cfd8fb7064_30	fill in the blank b7222cfd8fb7064_31	fill in the blank b7222cfd8fb7064_32	fill in the blank b7222cfd8fb7064_33	fill in the blank b7222cfd8fb7064_34	fill in the blank b7222cfd8fb7064_35
Oh That Hair	fill in the blank b7222cfd8fb7064_36	fill in the blank b7222cfd8fb7064_37	fill in the blank b7222cfd8fb7064_38	fill in the blank b7222cfd8fb7064_39	fill in the blank b7222cfd8fb7064_40	fill in the blank b7222cfd8fb7064_41	fill in the blank b7222cfd8fb7064_42
One Stop Hair Designs	fill in the blank b7222cfd8fb7064_43	fill in the blank b7222cfd8fb7064_44	fill in the blank b7222cfd8fb7064_45	fill in the blank b7222cfd8fb7064_46	fill in the blank b7222cfd8fb7064_47	fill in the blank b7222cfd8fb7064_48	fill in the blank b7222cfd8fb7064_49
Visions Hair & Nail	fill in the blank b7222cfd8fb7064_50	fill in the blank b7222cfd8fb7064_51	fill in the blank b7222cfd8fb7064_52	fill in the blank b7222cfd8fb7064_53	fill in the blank b7222cfd8fb7064_54	fill in the blank b7222cfd8fb7064_55	fill in the blank b7222cfd8fb7064_56
Totals	fill in the blank b7222cfd8fb7064_57	fill in the blank b7222cfd8fb7064_58	fill in the blank b7222cfd8fb7064_59	fill in the blank b7222cfd8fb7064_60	fill in the blank b7222cfd8fb7064_61	fill in the blank b7222cfd8fb7064_62	fill in the blank b7222cfd8fb7064_63
Percent uncollectible (%)		fill in the blank b7222cfd8fb7064_64%	fill in the blank b7222cfd8fb7064_65%	fill in the blank b7222cfd8fb7064_66%	fill in the blank b7222cfd8fb7064_67%	fill in the blank b7222cfd8fb7064_68%	fill in the blank b7222cfd8fb7064_69%
Estimate of uncollectible accounts	$fill in the blank b7222cfd8fb7064_70	$fill in the blank b7222cfd8fb7064_71	$fill in the blank b7222cfd8fb7064_72	$fill in the blank b7222cfd8fb7064_73	$fill in the blank b7222cfd8fb7064_74	$fill in the blank b7222cfd8fb7064_75	$fill in the blank b7222cfd8fb7064_76

Feedback

Add the accounts into the aging schedule based on their number of days past due.

Apply the respective uncollectible percentage to the total receivables in each days past due group and the not past due group.

3. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule. $fill in the blank b7b7d9f6904dfb0_1

Feedback

Add the accounts into the aging schedule based on their number of days past due.

Apply the respective uncollectible percentage to the total receivables in each days past due group and the not past due group.

4. Assume that the allowance for doubtful accounts for Wig Creations has a credit balance of $3,800 before adjustment on December 31, 20Y7. Journalize the adjustment for uncollectible accounts. If an amount box does not require an entry, leave it blank.

Dec. 31		fill in the blank e385e9faefd2fe7_2	fill in the blank e385e9faefd2fe7_3
		fill in the blank e385e9faefd2fe7_5	fill in the blank e385e9faefd2fe7_6

Feedback

The amount of bad debt expense is affected by the balance in the allowance account.

5. Assume that the adjusting entry in (4) was inadvertently omitted, how would the omission affect the balance sheet and income statement?

On the balance sheet, assets would be by $fill in the blank d416210defc0fea_2 because the allowance for doubtful accounts would be by $fill in the blank d416210defc0fea_4. In addition, the stockholders equity (retained earnings) would be by $fill in the blank d416210defc0fea_6 because bad debt expense would be and net income by $fill in the blank d416210defc0fea_9 on the income statement.

Feedback

Consider the effects of a contra asset not being recorded in terms of the balance sheet equation.

Consider the effects of an expense not bein