Chapter 8 (6 marks, 12 minutes)

Cardy Ltd. prepares an aging schedule for its accounts receivable at each month end and records bad debts expense monthly. At the end of October 2020, the company prepares the following aging schedule:

Number of outstanding days	Accounts receivable	Estimated percentage uncollectible
0-30 days (current receivables)	$ 290,000	2%
31-60 days	70,000	4%
61-90 days	65,000	10%
Over 90 days	35,000	20%
Total receivables	$ 460,000

Given the above information:

A. Calculate the total estimated uncollectible accounts. (0.5 marks)

B. Prepare the adjusting journal entry to record bad debts if the unadjusted balance in the Allowance for Doubtful Accounts is a credit balance of $5,600. (2 marks)

C. Prepare the adjusting journal entry to record bad debts if the unadjusted balance in the Allowance for Doubtful Accounts is a debit balance of $5,600. (2 marks)

D. On November 15, 2020, Cardy determined that one of its customers owing $9,200 declared bankruptcy and consequently, the account was uncollectible. Prepare the journal entry to write off the uncollectible account. (1.5 marks)

Chapter 8 (6 marks, 12 minutes) Cardy Ltd. prepares an aging schedule for its accounts receivable at each month end and records bad debts expense monthly. At the end of October 2020, the company prepares the following aging schedule: Estimated Accounts percentage Number of outstanding days receivable uncollectible 0-30 days (current receivables) $ 290,000 2% 31-60 days 70,000 4% 61-90 days 65,000 10% Over 90 days 35,000 209 Total receivables $ 460,000 Given the above information: A. Calculate the total estimated uncollectible accounts. (0.5 marks) B. Prepare the adjusting journal entry to record bad debts if the unadjusted balance in the Allowance for Doubtful Accounts is a credit balance of $5,600. (2 marks) Prepare the adjusting journal entry to record bad debts if the unadjusted balance in the Allowance for Doubtful Accounts is a debit balance of $5,600. (2 marks) C. D. On November 15, 2020, Cardy determined that one of its customers owing $9,200 declared bankruptcy and consequently, the account was uncollectible. Prepare the journal entry to write off the uncollectible account. (1.5 mark s)