11. Steve Company has the following unadjusted account balances on December 31,

Question

11. Steve Company has the following unadjusted account balances on December 31, 2016. The pre-adjustment balance of Allowance for Doubtful Accounts is S3,200 debit. This company uses the following aging of accounts receivable to estimate its bad debts Accounts A Current (not yet due) 1-30 past due 31-60 past due 61-90 past due Over 90 days past due Total Balance $192,000 $128,000 S 32,000 13,000 Estimated Uncollectible % 1.0% 3.5% 12.0% 42.0% 67.0% 4 The Net Realizable Value of Accounts Receivable reported on the year-end Balance Sheet will be: A) S354,612 B) S391,925 C) S351,412 D) S348,212

Explanation / Answer

C) $ 351,412

Accounts Age Balance Estimated Uncollectible % Estimated Uncollectible Amount Current (Not yet due)         1,92,000 1.0% 1,920 1-30 past due         1,28,000 3.5% 4,480 30-60 past due            32,000 12.0% 3,840 61-90 past due            13,000 42.0% 5,460 Over 90 days past due 6,400 67.0% 4,288 Total         3,71,400 19,988 Net Realisable value of Accounts receivable (371400-19,988) 351,412

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