The Company has the following unadjusted account balances on December 31, 2019. The preadjustment balance of Allowance...
The Company has the following unadjusted account balances on December 31, 2019. The preadjustment balance of Allowance for Doubtful Accounts is $3,200 debit. This company uses the following aging of accounts receivable to estimate its bad debts.
Here is Accounts Age, Balance and Estimated Uncollectible%
Current (not yet due) $192,000 1.0%
1-30 past due $128,000 3.5%
31-60 past due $32,000 12.0%
61-90 past due $13,000 42.0%
Over 90 days past due $6,400 67.0%
Total $371,400
The Net Realizable Value of Accounts Receivable reported on the year-end Balance Sheet will be: Select one: a. $351,412 b. $391,925 c. $354,612 d. $348,212
Homework Answers
| Days | Account receivable | % Uncollectible | $ Uncollectible |
| Current | 192000 | 1% | 1920 |
| 1-30 | 128000 | 3.5% | 4480 |
| 31-60 | 32000 | 12% | 3840 |
| 61-90 | 13000 | 42% | 5460 |
| Over 90 | 6400 | 67% | 4288 |
| Total | 371400 | 19988 |
Net realizable value = Account receivable-Allowance for doubtful accounts = 371400-19988 = 351412
So answer is a) $351412
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