P8-3A Presented below is an aging schedule for Bryan Company. Not YetNumber of D
ID: 2568593 • Letter: P
Question
P8-3A Presented below is an aging schedule for Bryan Company. Not YetNumber of Days Past Due Customer Total Due 1-30 31-60 61-90 Over 90 24,000 30,000 30,000 50,0005,0005,000 38,000 120,000 72,000 35,000 13,000 9,000 $15,000 Aneesh Bird Cope DeSpears Others $40,000 $38,000 $262,000 $107,000 $49,000 $28,000 $40,000 $38,000 Estimated percentage uncollectible 12% | 24% | 60% 3% 790 Total estimated bad debts $ 42,400 3,210 3,430$ 3,360 $ 9,60 $22,800 At December 31, 2016, the unadjusted balance in Allowance for Doubtful Accounts is a credit of $8,000. Instructions rnalize and post the adjusting entry for bad debts at Dcember 31, 2016. (Use T-accounts.) 1. March 1, a $600 2. M and post to the allowance account these 2017 events and transactions: customer balance originating in 2016 is judged uncollectible. ay 1, a check for $600 is received from the customer whose account was written off as uncollectible on March 1 .Explanation / Answer
a) Total esttimated bad debt = $42,400, Unadjusted balance for allowance for doubtful accounts already created is $8,000.
Hence the journal entry on December 31, 2016 is
Bad debt expense Dr............34,400
To Allowance for doubtful accounts.........34,400
(Being journal entry passed for recognising bad debt expense netted off with unadjusted credit ($42,400-$8,000))
b) Journal entries are as below
b.1 on March, 1 the entry passed will be
Allowance for doubtful debts Dr...................$600
To Accounts receivables............................................$600
b.2 on May, 1 the entry passed will be
Accounts Receivables Dr...................$600
To Allowance for doubtful debts Dr...................$600
and
Cash A/c Dr............$600
To Accounts receivables.................$600
c) On 31-Dec-2017 Journal entiry passed will be
Bad debt expense A/c Dr........$38,100
To Allowance for doubtful accounts ..........$38,100
($36,700 + $1400)
Bad debt expense Date Particulars Amount Date Particulars Amount 31-Dec-16 To Allowance for doubtful accounts 34,400 31-Dec-16 Clsoing bal 34,400Related Questions
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