Question
Young and Old Corporation (YOC) uses two aging categories to estimate uncollectible accounts. Accounts less than 60 days are considered young and have a 4%
Young and Old Corporation (YOC) uses two aging categories to estimate uncollectible accounts. Accounts less than 60 days are considered young and have a 4% uncollectible rate. Accounts more than 60 days are considered old and have a 35% uncollectible rate. Required: If YOC has $101,000 of young accounts and $410,000 of old accounts, how much should be reported in the Allowance for Doubtful Accounts? If YOCs Allowance for Doubtful Accounts currently has an unadjusted credit balance of $41,000, how much should be credited to the account? If YOCs Allowance for Doubtful Accounts has an unadjusted debit balance of $5,100, how much should be credited to the account?
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