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 3%
Young and Old Corporation (YOC) uses two aging categories to estimate uncollectible accounts. Accounts less than 60 days are considered young and have a 3% uncollectible rate. Accounts more than 60 days are considered old and have a 40% uncollectible rate.
1) If YOC has $114,000 of young accounts and $360,000 of old accounts, how much should be reported in the Allowance for Doubtful Accounts?
2) If YOCs Allowance for Doubtful Accounts currently has an unadjusted credit balance of $36,000, how much should be credited to the account?
3) If YOCs Allowance for Doubtful Accounts has an unadjusted debit balance of $4,600, how much should be credited to the account?
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