Question
Please answer following questions and create brief report by referring to the data in the photo attached below: 1. Your recommendations and the reasoning behind
Please answer following questions and create brief report by referring to the data in the photo attached below:
1. Your recommendations and the reasoning behind them should you use percent of credit sales or aging of receivables? (Consider: Is the aging method the right choice for the company given the historical data? Should all the years be included in the analysis? Should you use mean or median to calculate the percentages? Are there any extreme observations that should not be included in the analysis? Do the number of customers matter in a given year? Does the balance of total receivables vary significantly and what you conclude given these differences?)
2. Based on your recommendation, calculate the amount of bad debt expense you should report for 2018. Assume 2018 beginning balance of Allowance for Uncollectible Accounts is $200,000 (credit). (Provide the analysis of the credit sales or outstanding receivables in each aging category for 2018 that led you to this number in the table above)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started