a The aging of Torme Designs accounts receivable is shown be

(a) The aging of Torme Designs\' accounts receivable is shown below. Calculate the amount of each periodicity range that is deemed to be uncollectible.

?

Est. Uncollectible Accts.

Balance

Percentage

Amount

850,000

3.50%

47,500

5.00%

21,750

10.00%

11,250

20.00%

5,065

30.00%

2,500

50.00%

1,145

95.00%

939,210

?

(b)  If the Allowance for Doubtful Accounts has a credit balance of $1,135.00, record the adjusting entry for
the bad debt expense for the year.

	Est. Uncollectible Accts.
Age Interval	Balance	Percentage	Amount
Not past due	850,000	3.50%
1-30 days past due	47,500	5.00%
31-60 days past due	21,750	10.00%
61-90 days past due	11,250	20.00%
91-180 days past due	5,065	30.00%
181-365 days past due	2,500	50.00%
Over 365 days past due	1,145	95.00%
Total	939,210

Solution

Answer:

(a)

Est. Uncollectible Accts.

Age Interval

Balance

Percentage

Amount

Not past due

850000

3.50%

29750

1-30 days past due

47500

5.00%

2375

31-60 days past due

21750

10.00%

2175

61-90 days past due

11250

20.00%

2250

91-180 days past due

5065

30.00%

1519.5

181-365 days past due

2500

50.00%

1250

Over 365 days past due

1145

95.00%

1087.75

Total

939210

40407.25

(b)

Uncollectable account expanses

=40,407.25-1135

=$39,272.25

Description

Debit $

Credit $

Uncollectable account expanses

39272.25

Allowance for Doubtful account

39272.25

	Est. Uncollectible Accts.
Age Interval	Balance	Percentage	Amount
Not past due	850000	3.50%	29750
1-30 days past due	47500	5.00%	2375
31-60 days past due	21750	10.00%	2175
61-90 days past due	11250	20.00%	2250
91-180 days past due	5065	30.00%	1519.5
181-365 days past due	2500	50.00%	1250
Over 365 days past due	1145	95.00%	1087.75
Total	939210		40407.25