Manilow Company has asked you to help create year-end journal entries. They are currently reporting $555,000.00 in accounts receivable and they have sent you a download of their accounts receivable subsidiary ledger for your review, along with the A/R general ledger and the GL print-out of the Allowance Account.

Instructions 

Calculate the following items:

1. Using the attached spreadsheet, complete the:
1. Net Realizable Value of Accounts Receivable using the aging analysis.
2. Allowance for doubtful accounts amount.
3. Bad debt expense.
2. Manilow Company also wants to know how close they would be to the same result if they used the % of sales method monthly.
1. Use Total credit sales for the year = $4,800,000 and estimated bad debt expense = 0.5% of sales.
2. Calculate the % of sales you would tell Manilow Company to use to come close to the Allowance for doubtful accounts total from 1(a).

Part 1(a): Net Realizable Value

Manilow Corporation

Accounts Receivable Aging Analysis as of 30-Sep-20

			current
	invoice date		0–30 days	31–60 days	61–90 days	91–120 days	>120 days
ABC Company	9/1/2020	$ 25,000.00	$ 25,000.00	$ -	$ -	$ -	$ -
	9/30/2020	$ 99,500.00	$ 99,500.00	$ -	$ -	$ -	$ -
Babab, Inc.
3/3/2019	$ 15,000.00	$ -	$ -	$ -	$ -	$ 15,000.00
	7/31/2020	$ 35,000.00	$ -	$ -	$ 35,000.00	$ -	$ -
Country, LLC
9/5/2020	$ 15,000.00	$ 15,000.00	$ -	$ -	$ -	$ -
	6/15/2020	$ 10,000.00	$ -	$ -	$ -	$ 10,000.00	$ -
Debo, Co.
8/15/2020	$ 15,000.00	$ -	$ 15,000.00	$ -	$ -	$ -
	4/20/2020	$ 20,000.00	$ -	$ -	$ -	$ -	$ 20,000
LaLa Land
9/9/2020	$ 5,000.00	$ 5,000	$ -	$ -	$ -	$ -
	9/30/2020	$ 125,000.00	$ 125,000.00	$ -	$ -	$ -	$ -
Monte and Sons
9/11/2020	$ 2,800.00	$ 2,800.00	$ -	$ -	$ -	$ -
	8/4/2020	$ 25,000.00	$ -	$ 25,000.00	$ -	$ -	$ -
Operational Orgs
9/13/2020	$ 42,200.00	$ 42,200.00	$ -	$ -	$ -	$ -
	8/31/2020	$ 45,000.00	$ 45,000.00	$ -	$	$ -	$ -
Ready Mix
9/15/2020	$ 35,000.00	$ 35,000.00	$ -	$ -	$ -	$ -
	9/16/2020	$ 40,500.00	$ 40,500.00	$ -	$ -	$ -	$ -
Probability of collection
95%	90%	80%	70%	40%