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Your company has averaged about 26% of its accounts receivable in the over 90 days past due category and now forecasts 18% in this category.
Your company has averaged about 26% of its accounts receivable in the "over 90 days past due" category and now forecasts 18% in this category. You use the aging of accounts receivable method of estimating bad debt expense. If the total of credit sales remains unchanged from previous months and no write-offs are made, the estimate of bad expense based on the new forecast: Multiple Choice should decrease over the estimate for previous months. will depend on the percentage of credit sales deemed un-collectible. should not change compared to previous months. should increase over the estimate for previous months
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