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Entry for Uncollectible Accounts Outlaw Bike Co. is a wholesaler of motorcycle s

ID: 2398956 • Letter: E

Question


Entry for Uncollectible Accounts Outlaw Bike Co. is a wholesaler of motorcycle supplies. An aging of the company's accounts receivable on December 31 and a historical analysis of the percentage of uncollectible accounts in each age category are given below Estimated Uncollectible Accounts Amount Estimated Uncollectible Age Interval Not past due 1-30 days past due 1-60 days past due 61-90 days past due 91-180 days past due Over 180 days past due Total Balance Accounts Percent $892,000 285,000 101,000 63,000 43,100 17,700 1,401,800 0.75 % 1.00 8.00 16.00 0,00 $6,690 2,850 8,080 10,080 21,550 14,160 63,410 80.00 Assume that the allowance for doubtful accounts for Outiaw Bike Co. had a debit balance of $5,140 as of December 31. Journalize the adjusting entry for uncollectible accounts as of December 31 Dec. 31

Explanation / Answer

Answer:

Date

Account title and description

debit $

Credit $

31-Dec

Bad Debts Expense

68550

Allowance for doubtful debts

68550

(63410+5140)

(To record the adjustment entry)

Date

Account title and description

debit $

Credit $

31-Dec

Bad Debts Expense

68550

Allowance for doubtful debts

68550

(63410+5140)

(To record the adjustment entry)