Question

At December 31, 2018, the Accounts Receivable balance of Foley Distribution Service is $185,000. The Allowance for Bad Debts account has a $14,160 debit balance. Foley Distribution Service prepares the following aging schedule for its accounts receivable: (Click the lcon to view the aging schedule.) Read the requirements Requirement 1. Joumalize the year-end adjusting entry for bad debts on the basis of the aging schedule. Show the T-account for the Allowance for Bad Debts at December 31, 2018. Begin by determining the target balance of Allowance for Bad Debls by using the age of each account i Requirements Age of Accounts 61-90 1-30 31-60 Over 90 Total 1. Joumalize the year-end adjusting entry for bad debts on the basis of the aging schedule, Show the T-account for the Allowance for Bad Debts at December Days Days Days Days Balance S 35,000 Accounts Recelvable 60,000 65,000 25,000 31, 2018. 0.1 4.0 5.0 45.0 2. Show how Foley Distribution Service will report its net accounts receivable on its December 31, 2018, balance sheet Estimated percent uncollectible % % Estimated total uricollectible Journalize the year-end adjusting entry for doubtful accounts on the basis of the aging schedule. (Record debits first then credits. i Data T Done Print Accounts and Explanation Date Debit Credit Dec. 31 Age of Accounts 1-30 Days 31-60 Days 61-90 Days Over 90 Days 60,000 S 65,000 $ 35,000 $ 25,000 Accounts Receivable 5.0 % Estimated percent uncollectible 0.1 % 4.0% 45.0 %

Answer 1

Schedule

	1-30 days	31-60 days	61-90 days	Over 90	Total
Account receivable	60000	65000	35000	25000	185000
% Uncollectible	0.1%	4%	5%	45%
$ Uncollectible	60	2600	1750	11250	15660

Adjusting entry

Date	account and explanation	Debit	Credit
Dec 31	Bad debt expense (14160+15660)	29820
	Allowance for doubtful accounts		29820

Allowance for bad debt

Dec 31	14160	Dec 31 adj	29820
		Dec 31	15660

Balance sheet presentation

Current assets
Account receivable	185000
Less: Allowance for doubtful accounts	-15660	169340