Question
Alimama Inc. uses the Aging of Accounts Receivable method to estimate bad debt expense for the year 2019. The ending balance of each account receivable
Alimama Inc. uses the Aging of Accounts Receivable method to estimate bad debt expense for the year 2019. The ending balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, $16,100; (2) up to 120 days past due, $7,100; and (3) more than 120 days past due, $3,600. Experience has shown that for each age group, the average loss rate on the amount of the receivables at year-end due to uncollectibility is (1) 2 percent, (2) 13 percent, and (3) 35 percent, respectively. At December 31, 2019, the Allowance for Doubtful Accounts balance is $800 (credit) before the end-of-period adjusting entry is made. Required: In the following table: 1) fill out the first four rows to complete the Account Receivable Aging Schedule; and 2) fill out the last two rows to estimate the Bad Debt Expense for 2019. (In Column "Estimated Percentage Uncollectible", please enter your answers as a
Aged Accounts Receivable Estimated Percentage Uncollectible Estimated Amount Uncollectible Not yet due Up to 120 days past due Over 120 days past dueStep by Step Solution
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