Compute the amount of gross profit recognized during 2015 and 2016 The Allowance
ID: 2509875 • Letter: C
Question
Compute the amount of gross profit recognized during 2015 and 2016
The Allowance for Uncollectible accounts at the beginning of the year was 30,000. The Gross Accounts Receivable at the end of year is shown below at 347,000.Using the information given:
Prepare the AJE for Bad Debt Expense for 12/31/16.
What is the Net Accounts Receivable at year end, 12/31/16.
AGE GROUP Amount Percent Uncollectible Estimated Allowance
0-60 days $225,550 4% $9,022
61-90 days $69,400 15% $10,410
91-120 days $34,700 25% $8, 675
Over 120 days $17,350 40% $6,940
Totals $347,000 $35,047
Explanation / Answer
1-
adjusted journal entries
date
explanation
debit
credit
31-Dec
bad debt expense
5047
allowance for doubtful debts
5047
2-
gross Accounts receivable
347000
less allowance for doubtful debts
35047
net accounts receivables at year end
311953
Bad debts for the year
bad debt of the year- previous balance in allowance for doubtful debts
35047-30000
5047
1-
adjusted journal entries
date
explanation
debit
credit
31-Dec
bad debt expense
5047
allowance for doubtful debts
5047
2-
gross Accounts receivable
347000
less allowance for doubtful debts
35047
net accounts receivables at year end
311953
Bad debts for the year
bad debt of the year- previous balance in allowance for doubtful debts
35047-30000
5047
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