An accounts receivable aging schedule is presented below along with the estimate

Question

An accounts receivable aging schedule is presented below along with the estimated percent uncollectible for each age group,

                             Age group                   Amount                      %

                           0- 60 days                    54,000                      1.0

                           61- 90 days                    27,000                      5.0

                           91-120 days                      6,000                    20.0

                         over 120 days                     3,000                     50.0

Calculate the bad debt expense.

An accounts receivable aging schedule is presented below along with the estimated percent uncollectible for each age group,

Explanation / Answer

= (54000 * 1%) + (27000 * 5%) + (6000 * 20%) + (3000 *50%)

= 540 + 1350 + 1200 +1500

= 4590 (Bad debt expenses)

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