Question

ACC210 Assignment-1.xlsx Open with B D E G 2 CHECK FIGURE: 2. Bad Debt Expense - $43.860 On December 31, 2017. RCA Company's Allowance for Doubtful Accounts had an unadjusted debit balance of $7.800. The accountant for RCA has prepared a schedule of the December 31, 2017, accounts receivable by age and, on the basis of past experience, has estimated the percentage of the receivables in cach age category that will become uncollectible. This information is summarized as follows: December 31, 2017 Accounts Receivable Age of Accounts Recelyable Expected Percentage Uncollectible $620,000 355,600 91,000 11.500 7,600 Not due (under 30 days) 1 to 30 days past due 31 to 60 days past due 61 to 90 days past due Over 90 days past due 1.75% 2.5 8.5 35 60 Required 1. Calculate the amount that should appear in the December 31, 2017, balance sheet as the Allowance for Doubtful Accounts. Percentage Uncollectible Balance Age of Accounts Receivable Allowance for Doubtful Accounts

Answer 1

RCA Company

1.

Age of Accounts Receivable	Balance	Percentage Uncollectible	Allowance for Doubtful Accounts
Not due (under 30 days)	620000	1.75%	10850
1 to 30 days past due	355600	2.50%	8890
31 to 60 days past due	91000	8.50%	7735
61 to 90 days past due	11500	35%	4025
Over 90 days past due	7600	60%	4560
Total $			36060

2.

Date	Account Titles	Debit	Credit
Dec. 31, 2017	Bad debt expense ($36060 + $7800)	43860
	Allowance for doubtful accounts		43860
	(To record the bad debt expense)

Analysis Component:

No effect.

The write off will have no effect on the 2018 profit as the journal entry to record the write off will debit the allowance for doubtful accounts and credit the accounts receivable. Thus, no income statement account will be affected due to which there will be no effect on the 2018 profit.

Per Chegg guidelines the first question has been answered. Please post each of the remaining independent questions separately. Thank you.