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Guiltier Corporation_uncollectible accounts




Question;Guiltier Corporation uses allowance method to accounts uncollectible;accounts receivables. Credit terms for sales is n30 (net is due at 30 days).;Below is the company?s uncollectible policy;?;Monthly provision for uncollectible;accounts is 2% of credit sales.;?;Write-off of bad debts is debited to;allowance for uncollectible accounts.;?;If bad debt is recovered after being;written off, the amount is credited to allowance for uncollectible accounts.;Below is information about credit sales, bad debt and uncollectible;accounts. All accounts are shown in thousands.;?;January 1, 2013, balance in allowance;for uncollectible accounts was $130.;?;Credit sales for the year was $9,000.;?;As per policy, monthly provision for;uncollectible accounts is 2% of credit sales was made throughout the year.;?;Write-off of bad debts was $90.;?;Recoveries of accounts previously;written off was $15.;Aging Reports of accounts receivable based on months of sales is below.;This was prepared on December 30, 2013 (the last day of sale for the year). All;accounts are shown in thousands.;Description Balance Estimated;% Uncollectible;11/1/13-12/30/13 $1,080 2%;7/1/13 ? 10/31/13 650 10%;1/1/2013-6/30/2013 420 25%;12/31/2012 150 80%;Total $2,300;On December 31, 2013, Guiltier Corporation?s accountant wrote off $60;from the 12/31/2012 accounts receivable balance. The estimated percentage;uncollectible is applicable to the remaining balance after the write off.;Required;a. Prepare a schedule as of December 31, 2013 showing the balance in the;allowance for uncollectible accounts. Remember to include the write off on this;date as described above.;b. Prepare journal-entry for the adjustment;to allowance for uncollectible accounts on December 31, 2013.;c. Show how accounts receivables will be shown on Guiltier Corporation?s;balance sheet on December 31, 2013.


Paper#38260 | Written in 18-Jul-2015

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