Ed Co. prepared an aging of its accounts receivable at December 31, 2004 and determined that the net realizable value of the receivables was $290,000. Additional information is available as follows:
Allowance for uncollectible accounts at 1/1/04?credit balance $ 29,000
Accounts written off as uncollectible during 2004 23,000
Accounts receivable at 12/31/04 320,000
Uncollectible accounts recovered during 2004 5,000
For the year ended December 31, 2004, Ed's uncollectible accounts expense would be
Estimated uncollectible expenses for 2004 should be (d) $19000 as explained below.
Account Receivable 31st Dec 2004 (Dr Bal) $320000
Add:: Amount previously written off Reversed $5000
Less: Amount recovered from the accounts previously written off ...
The solution examines uncollectible accounts.
Uncollectibles for Ed Co.
The following accounts were abstracted from Ed Co.'s unadjusted trial balance at December 31, 2007:
Accounts receivable $700,000
Allowance for uncollectible accounts 8,000
Net credit sales $3,000,000
Ed's estimates that 2% of the gross accounts receivable will become uncollectible. After adjustment at December 31, 2007, the allowance for uncollectible accounts should have a credit balance of?View Full Posting Details