80.2K

Verified Solution

Link Copied!

5. Sunrise Products Sunrise Products has 250 accounts receivable accounts. All accounts are due in 30 days. On June 30, an aging schedule was prepared. The results are summarized below:

Total Not Yet Due 1-30 days past due 31-60 days past due 61-90 days past due Over 90 days past due Amounts $345,250 $183,590 $94,680 $43,340 $9,000 $14,640

Two accounts receivable were accidentally omitted from this schedule. The following data is available regarding these accounts:

1. R. Jones owes $4,250 from two invoices: invoice no. 218, dated March 14, in the amount of $2,980; and invoice no. 568, dated May 9, in the amount of $1,270.

2. F. Smith owes $3,760 from two invoices: invoice no. 574, dated May 19, in the amount of $1,350: and invoice no. 641, dated June 5, in the amount of $2,410.

a) Complete the aging chart as of June 30 by adding to the column subtotals an aging of the accounts of Jones and Smith. b) Calculate the estimated portion of each age group that will prove uncollectable and the required balance in the Allowance for Doubtful Accounts. The following percentages of each age group are estimated to be uncollectable: Not yet due, 1%; 1-30 days, 4%; 31-60 days, 10%; 61-90 days, 30%; over 90 days, 50%. c) Prepare the journal entry to adjust the Allowance for Doubtful Accounts account at June 30, 1999. Prior to making this adjustment, the account has a credit balance of $13,800.

Answer & Explanation Solved by verified expert

See Answer