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As the management accountant for the Tyson Company you have been asked to construct a financial planning model for collection of accounts receivable and then
As the management accountant for the Tyson Company you have been asked to construct a financial planning model for collection of accounts receivable and then to perform a what-if analysis in terms of the assumption regarding estimated uncollectible accounts. You are provided with the following information: Collection Pattern for Credit Sales: 65% of the company's credit sales are collected in the month of sale and 30% in the month following the month of sale; 5% are uncollectible. Credit Sales: January 2022, \$112,000; February 2022, \$164,000; March 2022, $134,000. Required: 1. Prepare an estimate of bad debts for each of the three months, January through March, under the following assumptions regarding the rate of uncollectible accounts: 1%,3%,5% (base case), and 8%
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