Question
Jarden Company has credit sales of $2.30 million for year 2015. On December 31, 2015, the companys Allowance for Doubtful Accounts has an unadjusted credit
Jarden Company has credit sales of $2.30 million for year 2015. On December 31, 2015, the companys Allowance for Doubtful Accounts has an unadjusted credit balance of $14,718. Jarden prepares a schedule of its December 31, 2015, accounts receivable by age. On the basis of past experience, it estimates the percent of receivables in each age category that will become uncollectible. This information is summarized here. December 31, 2015 Accounts Receivable Age of Accounts Receivable Expected Percent Uncollectible $ 460,000 Not yet due 1.10 % 184,000 1 to 30 days past due 1.85 36,800 31 to 60 days past due 6.35 18,400 61 to 90 days past due 32.00 3,680 Over 90 days past due 66.00 rev: 05_14_2015_QC_30626 6.value: 5.00 pointsRequired information Required: 1. Estimate the required balance of the Allowance for Doubtful Accounts at December 31, 2015, using the aging of accounts receivable method.
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