Jarden Company has credit sales of $3,100,000 for year 2017. On December 31, 201

Question

Jarden Company has credit sales of $3,100,000 for year 2017. On December 31, 2017, the company’s Allowance for Doubtful Accounts has an unadjusted credit balance of $20,055. Jarden prepares a schedule of its December 31, 2017, accounts receivable by age. On the basis of past experience, it estimates the percent of receivables in each age category that will become uncollectible. This information is summarized here.

2. Prepare the adjusting entry to record bad debts expense at December 31, 2017.

December 31, 2017
Accounts Receivable Age of
Accounts Receivable Expected Percent
Uncollectible $ 620,000 Not yet due 0.95 % 248,000 1 to 30 days past due 1.70 49,600 31 to 60 days past due 6.20 24,800 61 to 90 days past due 31.25 4,960 Over 90 days past due 65.00 Journal entry worksheet Record the estimated bad debts. Note: Enter deblts before credits Date General Journal Debit Credit Dec 31 Record entry Clear entry View general journal

Explanation / Answer

December 31, 2017 Age of Expected Percent Amount Accounts Receivable Accounts Receivable Uncollectible Uncollectible 620,000 Not yet due 0.95% 5890 248,000 1 to 30 days past due 1.70% 4216 49,600 31 to 60 days past due 6.20% 3075 24,800 61 to 90 days past due 31.25% 7750 4,960 Over 90 days past due 65% 3224 Total 24155 Date General Journal Debit Credit 31-Dec Bad debts expense 4,100 =24155-20055 Allowance for doubtful accounts 4,100

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