Question
Exercise 7-14 (Algo) Calculate uncollectible accounts using the aging method; record adjustments [LO7-5, 7-6] Zuo Software categorizes its accounts receivable into four age groups for
Exercise 7-14 (Algo) Calculate uncollectible accounts using the aging method; record adjustments [LO7-5, 7-6]
Zuo Software categorizes its accounts receivable into four age groups for purposes of estimating its allowance for uncollectible accounts.
- Accounts not yet due = $333,000; estimated uncollectible = 10%.
- Accounts 130 days past due = $41,600; estimated uncollectible = 14%.
- Accounts 3190 days past due = $33,300; estimated uncollectible = 17%
- Accounts more than 90 days past due = $25,000; estimated uncollectible = 21%.
At 12/31/2021, before recording any adjustments, Zuo has a credit balance of $25,500 in its allowance for uncollectible accounts. Required: 1. Estimate the appropriate 12/31/2021 balance for Zuos allowance for uncollectible accounts. 2. What journal entry should Zuo record to adjust its allowance for uncollectible accounts? 3. Calculate Zuos 12/31/2021 net accounts receivable balance.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started