Question
Use the following information and complete required items 1-3 The accounts receivable listing of StartUp Company shows the following on December 31, 2020. The general
| Use the following information and complete required items 1-3 |
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| The accounts receivable listing of StartUp Company shows the following on December 31, 2020. |
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| The general ledger showed a $250 credit balance in Allowance for Doubtful Accounts before adjustment | ||||
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| Name of customer | Invoice date | Amount |
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| Speals Inc. | December 5, 2020 | $750 |
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| Siron Corporation | August 11, 2020 | 425 |
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| Screen Corporation | December 11, 2020 | 475 |
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| Bean Inc. | July 3, 2020 | 200 |
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| Apples Inc. | September 16, 2020 | 505 |
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| Apples Inc. | July 4, 2020 | 875 |
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| Window Inc. | March 3, 2020 | 625 |
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| Trail Corporation | November 14, 2020 | 825 |
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| Spokes Inc. | November 20, 2020 | 325 |
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| Winter Corporation | October 19, 2020 | 700 |
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| Required: |
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| 1. Prepare an aging of accounts receivable at December 31, 2020 |
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| 2. Compute estimated loss based on the following: |
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| Age (days) | Estimated Loss Percentage |
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| 1-30 | 2% |
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| 31-60 | 3% |
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| 61-90 | 10% |
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| 91-120 | 15% |
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| 121-150 | 25% |
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| Over 150 | 50% |
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| 3. Prepare a journal entry to record the bad debt expense for the year. |
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Managerial Accounting
Authors: James Jiambalvo
5th edition
1118078764, 978-1118078761
