Question

Coach Limited uses the allowance method to account for the uncollectible accounts receivable. The accounting policy is to relate the provision for doubtful debts to the age of debts outstanding.

The opening balance of the allowance for doubtful debts account in the Balance Sheet as at January 2021 included a credit balance of $22,000. The companys accounts for the year ended December 2021 are now being prepared. The debts outstanding at December 31 2021 and the required allowance for doubtful debts are as follows:

Debts outstanding:

Not due (under 30 days) 1 to 30 days past due

31 to 60 days past due 61 to 90 days past due Over 90 days past due

Required:

Amount Allowance for doubtful debts $%

2,050,000 1.25 971,000 2.00 207,000 6.50 132,000 25.00

34,000 50.00 3,394,000

a) Prepare a statement to calculate the amount of allowance for doubtful debts account for the year ended December 31 2021.

(30 marks)

b) Prepare the Allowance for doubtful debts account for the year ended December 31,

2021.

(20 marks)

c) Prepare the journal entry to record the amount of allowance required for the year ended December 31, 2021. marks)

(20 marks)

d) Show the extracts of the Accounts Receivable in the Balance Sheet of Coach Limited as at December 31, 2021.

END OF ASSIGNMENT 2

(30 marks)

Security 19WGu6Yog2_BOUVODOSKO/view IN PURSUE Open with Coach Limited uses the allowance method to account for the incollectible accounts receivable. The accounting policy is to relate the provision for doubtful debts to the age of debts outstanding The opening balance of the allowance for doubtful debts account in the Balance Sheet us at Jamury 2021 included a credit balance of 522,000. The company's accounts for the year ended December 2021 we now being prepared. The debts outstanding at December 31 2021 and the required allowance for doubtful debts are as follows a Debts outstanding Amount Not due (under 30 days) 1 to 30 days past due 31 to 60 days past due 61 to 90 days past due Over 90 days past due 2.050.000 971.000 207.000 132.000 34 000 3.394.000 Allowance for doubtil debts 56 1.25 2.00 6.50 25.00 50.00 Required: a) Prepare a statement to calculate the amount of allowance for doubtfal debts account for the year ended December 31 2021 (30) b) Prepare the Allowance for doubtful debts account for the year ended December 31, 2021 (20 maks c) Prepare the journal entry to record the amount of allomace required for the year ended December 31, 2021 marks) 20 marks d) Show the extracts of the Account Receable in the Balance Sheet of Coach Limited as at December 3120 Page 1 Q + 30 de o 13 DELL