Blue Spruce Corp. uses the allowance method of accounting for bad debts. The company produced the following aging of the accounts receivable at year-end.
Calculate the total estimated bad debts based on the information below.
Number of Days Outstanding
Total
0β30
31β60
61β90
91β120
Over 120
Accounts receivable
$494,000 $325,000 $91,000 $50,000 $17,000 $11,000
% uncollectible
1% 4% 5% 8% 11%
Estimated bad debts
$enter estimated bad debts in dollars
$enter estimated bad debts in dollars
$enter estimated bad debts in dollars
$enter estimated bad debts in dollars
$enter estimated bad debts in dollars
$enter estimated bad debts in dollars
Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined above. Assume the unadjusted balance in Allowance for Doubtful Accounts is a $3,900 debit. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Account Titles and Explanation
Debit
Credit
enter an account title for the adjusting entry to record the bad debts
enter a debit amount
enter a credit amount
enter an account title for the adjusting entry to record the bad debts
enter a debit amount
enter a credit amount
Of the above accounts, $4,800 is determined to be specifically uncollectible. Prepare the journal entry to write off the uncollectible account. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Account Titles and Explanation
Debit
Credit
enter an account title for the journal entry to write off the uncollectible account
enter a debit amount
enter a credit amount
enter an account title for the journal entry to write off the uncollectible account
enter a debit amount
enter a credit amount
The company collects $4,800 subsequently on a specific account that had previously been determined to be uncollectible in part (c). Prepare the journal entries necessary to (1) restore the account and (2) record the cash collection. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
No.
Account Titles and Explanation
Debit
Credit
1. enter an account title to record the first transaction
enter a debit amount
enter a credit amount
enter an account title to record the first transaction
enter a debit amount
enter a credit amount
2. enter an account title to record the second transaction
enter a debit amount
enter a credit amount
enter an account title to record the second transaction
enter a debit amount
enter a credit amount
Answers: 2
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Blue Spruce Corp. uses the allowance method of accounting for bad debts. The company produced the fo...
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