Estimating Bad Debts Using the Aging Method Assume that Simple Co. had credit sales of $250,000 and cost of goods sold of $150,000 for the period. Simple uses the aging method and estimates that the appropriate ending balance in the Allowance for Doubtful Accounts is $1,600. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $250. What amount of Bad Debt Expense would the company record as an end-of-period adjustment? What is the ending balance in Allowance? Computing Bad Debt Expense Using Aging of Accounts Receivable Method Young and Old Corporation (YOC) uses two aging categories to estimate uncollectible accounts Accounts less than 60 days are considered young and have a 5% uncollectible rate. Accounts more than 60 days are considered old and have a 35% uncollectible rate. Required: 1 If YOC has $100,000 of young accounts and $400,000 of old accounts, how much should be reported in the Allowance for doubtful accounts? 2. If YOC's Allowance for doubtful accounts currently has an unadjusted credit balance of $40,000 how much should be credited to the account? 3. IF YOC's Allowance for doubtful accounts has an unadjusted debit balance of $5,000, how much should be credited to the account? Various Journal Entries Web Wizard, Inc., has provided information technology services for several years. The company uses the percentage of credit sales method to estimate har dahan daerah 2. IF YOC's Allowance for doubtful accounts currently has an unadjusted credit balance of $40,000, how much should be credited to the account? 3. If YOC's Allowance for doubtful accounts has an unadjusted debit balance of $5,000, how much should be credited to the account? Various Journal Entries Web Wizard, Inc., has provided information technology services for several years. The company uses the percentage of credit sales method to estimate bad debts for internal monthly reporting purposes At the end of each quarter, the company adjusts its records using the aging of accounts receivable method. The company entered into the following selected transactions during the first quarter of 2014 a. During January, the company provided services for $40,000 on credit. b. On January 31, the company estimated bad debts using 1 percent of credit sales. c. On February 4, the company collected $20,000 of accounts receivable. d. On February 15, the company wrote off a $100 account receivable. e. On March 1, the company loaned $2,400 to an employee who signed a 6% note, due in 6 months. f. On March 15, the company collected $100 on the account written off one month earlier. g. On March 31, the company accrued interest earned on the note. Recordina Note Receivable Transactions