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    Calculation of debt debt expense, writing off receivables

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    Wall Inc. uses the allowance method to estimate uncollectible accounts receivable. The company produced the following aging of the accounts receivable at year end.
    Number of Days Outstanding
    Total 0-30 31-60 61-90 91-120 Over 120
    Accounts receivable $375,000 $220,000 $90,000 $40,000 $10,000 $15,000
    % uncollectible 1% 4% 5% 8% 10%
    Calculate the total estimated bad debts based on the above information.
    Number of Days Outstanding
    Total 0-30 31-60 61-90 91-120 Over 120
    Accounts receivable $375,000 $220,000 $90,000 $40,000 $10,000 $15,00
    % uncollectible 1% 4% 5% 8% 10%
    Estimated bad debts $ $ $ $ $ $
    Prepare the year-end adjusting journal entry to record the bad debts using the aged uncollectible accounts receivable determined in previous question. Assume the current balance in Allowance
    for Doubtful Accounts is a $8,000 debit.
    Description/Account Debit Credit
    Of the above accounts, $5,000 is determined to be specifically uncollectible. Prepare the journal entry to write off the uncollectible account.
    Description/Account Debit Credit
    The company collects $5,000 subsequently on a specific account that had previously been determined to be uncollectible in previous question. Prepare the journal entry(ies) necessary to restore
    the account and record the cash collection.
    Description/Account Debit Credit
    Accounts receivable
    Comment on how your answers to (a)-(d) would change if Wall Inc. used 3% of total accounts receivable, rather than aging the accounts receivable. What are the advantages to the company
    of aging the accounts receivable rather than applying a percentage to total accounts receivable?

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    https://brainmass.com/business/journal-entries/calculation-of-debt-debt-expense-writing-off-receivables-180256

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    WALL Inc
    Total Number of days outstanding
    0-30 31-60 61-90 91-120 >120
    Amount 375,000 220,000 90,000 40,000 10,000 15,000
    % uncollectible 1% 4% 5% 8% 10%
    Estimated bad debt 10,100 2,200 3,600 2,000 800 1,500

    The bad debts are estimate at $10,100. The balance in the allowance account is $8,000 debit. The balance ...

    Solution Summary

    The solution explains the process of recording cash received for an account that is written off as well the adjusting entries to be made

    $2.19

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