On December 31, 2017, Jerome Company has an accounts receivable balance of $316,000 before any year-end adjustments.
The Allowance for Doubtful Accounts has a $1,000 credit balance. The company prepares the following aging schedule for accounts receivable:
Total Balance 1-30 days 31-60 days 61-90 days over 90 days
$316,000 $152,000 $87,000 $50,000 $27,000
Percent uncollectible 1% 2% 3% 21%
What is the Allowance for Uncollectible Accounts at December 31, 2017?
A. $1,000
B. $11,430
C. $9,430
D. $10,43
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Ответ:
The Allowance for Uncollectible Accounts at December 31, 2017 is $10,430
Explanation:
In order to calculate the Allowance for Uncollectible Accounts at December 31, 2017 we would have to make the following calculation:
Allowance for Uncollectible Accounts at December 31, 2017=Estimated Allowance 1-30 days+Estimated Allowance 31-60 days+Estimated Allowance 61-90 days+Estimated Allowance over 90 days
Estimated Allowance 1-30 days=Balance*% Uncollectible
Estimated Allowance 1-30 days=$152,000*1%=$1,520
Estimated Allowance 31-60 days=$87,000*2%=$1,740
Estimated Allowance 61-90 days=$50,000*3%=$1,500
Estimated Allowance over 90 days=$27,000*21%=$5,670
Allowance for Uncollectible Accounts at December 31, 2017=$1,520+$1,740+$1,500+$5,670
Allowance for Uncollectible Accounts at December 31, 2017=$10,430
Ответ:
what do you mean by that?