Q2. Presented below is an aging schedule for Super Duper, a small retailor.

Number of Days Past Due

Customer

Total

Not Yet Due

1-30

31-60

61-90

Over 90

Chin

$22,000

Nil

$10,000

$12,000

Nil

Nil

Ming

40,000

$40,000

Nil

Nil

Nil

Nil

Zing

57,000

$16,000

$6,000

Nil

$35,000

Nil

Sing

34,000

Nil

Nil

Nil

Nil

$34,000

King

132,000

$96,000

$16,000

$14,000

Nil

$6,000

$285,000

$152,000

$32,000

$26,000

$35,000

$40,000

Estimated Percentage Uncollectible

2.5%

5.5%

14%

28%

65%

Instructions:

(a) Calculate the total estimated bad debts based on the above information.

(b) Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined in (a). Assume the current balance in Allowance for Doubtful Accounts is a $18,000 debit.

(c) Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined in (a). Assume the current balance in Allowance for Doubtful Accounts is a $9,000 credit.

(d) Assume that the company estimates bad debts expense on the basis of percentage of sales. The total Sales of the year was $3,280,000 and company estimates that 3.00% of this is uncollectible, whereas, the balance in Allowance for Doubtful Accounts is a $19,785. Prepare the year-end adjusting entry to record bad debts expense.

Q2. Presented below is an aging schedule for Super Duper, a small retailor.

Number of Days Past Due

Customer

Total

Not Yet Due

1-30

31-60

61-90

Over 90

Chin

$22,000

Nil

$10,000

$12,000

Nil

Nil

Ming

40,000

$40,000

Nil

Nil

Nil

Nil

Zing

57,000

$16,000

$6,000

Nil

$35,000

Nil

Sing

34,000

Nil

Nil

Nil

Nil

$34,000

King

132,000

$96,000

$16,000

$14,000

Nil

$6,000

$285,000

$152,000

$32,000

$26,000

$35,000

$40,000

Estimated Percentage Uncollectible

2.5%

5.5%

14%

28%

65%

Instructions:

(a) Calculate the total estimated bad debts based on the above information.

(b) Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined in (a). Assume the current balance in Allowance for Doubtful Accounts is a $18,000 debit.

(c) Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined in (a). Assume the current balance in Allowance for Doubtful Accounts is a $9,000 credit.

(d) Assume that the company estimates bad debts expense on the basis of percentage of sales. The total Sales of the year was $3,280,000 and company estimates that 3.00% of this is uncollectible, whereas, the balance in Allowance for Doubtful Accounts is a $19,785. Prepare the year-end adjusting entry to record bad debts expense.