Question
SKP Co. Ltd has accounts receivable of $102,870 at April 30. Credit terms are 2/10, n/30. At April 30, Allowance for Doubtful Accounts has a
SKP Co. Ltd has accounts receivable of $102,870 at April 30. Credit terms are 2/10, n/30. At April 30, Allowance for Doubtful Accounts has a credit balance of $510 prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The Companys estimate of bad debts is shown below. Age of Accounts Balance, April 30 Estimated Percentage Uncollectible 1-30 days $65,790 3.00% 31-60 days 28,640 6.00% 61-90 days 6,200 18.00% Over 90 days 2,240 45.00% Total $102,870 Required: e. Determine the total estimated uncollectible at April 30. (1.5 mark) f. Calculate the adjusted bad debt expense for the period. (1.5 marks) g. Prepare the journal entries to account for bad debt expense for the period. (3 marks) h. Work out the cash/net realisable value of Account receivable as at April 30. (1.5 mar
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