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As of December 31, Frappe Company has a balance of $17,000 in accounts receivable. Of this amount, $1,700 is past due and the remainder is
As of December 31, Frappe Company has a balance of $17,000 in accounts receivable. Of this amount, $1,700 is past due and the remainder is not yet due. Frappe has a credit balance of $165 in the Allowance for Doubtful Accounts. Frappe Company estimates its bad debt losses using the aging of receivables method, with estimated bad debt loss rates equal to 1% of accounts not yet due and 10% of past due accounts. How will the Bad Debt Expense account be included in the required adjusting journal entry at year-end? Multiple Choice Credit of $323 Debit of $158 Debit of $165 Debit of $163 Twilight Company uses the aging of accounts receivable method to estimate Bad Debt Expense. The balance of each account receivable is aged on the basis of three categories as follows: (1) 1-30 days old, (2) 31-90 days old, and (3) more than 90 days old. Based on experience, management has estimated what portion of receivables of a specific age will not be paid as follows: (1) 2%, (2) 15%, and (3) 35%, respectively. At December 31, 2019, the unadjusted credit balance in the Allowance for Doubtful Accounts was $240. The total Accounts Receivable in each age category were: (1) 1-30 days old, $58,000, (2) 31-90 days old, $17,000, and (3) more than 90 days old, $6,000. Required: a. Calculate the estimate of uncollectible accounts at December 31, 2019. b. Prepare the appropriate adjusting entry dated December 31, 2019
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