Walt's manufactures and sells customized work clothes and uniforms. Following is a list of accounts receivable as of December 31, 2019. I-07.04
1
Customer
Date of Sale
Amount
Air There Freight
December 11, 2019
12,300
Aurora
November 12, 2019
5,000
Batesville
August 18, 2019
14,805
CarMan
December 9, 2019
21,900
Clinic Quick
August 15, 2018
16,040
Delorres River Guides
September 19, 2019
8,990
Elonzo's Restaurant
December 17, 2019
11,789
Hospital Supply
December 4, 2019
135,100
Inidigo
November 29, 2019
16,500
Meridan Oil
May 20, 2019
11,786
Museum of Art
December 21, 2019
255,000
Novellus
February 16, 2019
18,780
Norman's
December 23, 2019
10,000
Robert Ricketts
December 14, 2019
3,550
Sanchez Systems
October 25, 2019
22,310
Security by the Hour
December 13, 2019
40,900
Stop Shop
December 27, 2019
34,700
Target Time
February 3, 2019
14,440
Uvlade Ranch
December 7, 2019
3,700
Xhi
October 20, 2019
15,100
Zebra Sports
December 3, 2019
144,000
(a)
(b)
(c)
Walt's manufactures and sells customized work clothes and uniforms.
Following is a list
of accounts receivable as of December 31, 2019.
Sort the receivables list by age category and determine the estimated balance of
uncollectible accounts.
Walt's believes the following rates of noncollection will
occur: 1% of receivables up to 30 days, 3% for 31 to 90 days, 10% for 91 to 180
days, and 40% of accounts over 180 days.
If the balance of Allowance for Uncollectible Accounts contained $15,000 (credit),
what adjusting entry is needed to re±ect the analysis from part (a)?
If the balance of Allowance for Uncollectible Accounts contained $15,000 (debit),
what adjusting entry is needed to re±ect the analysis from part (a)?
Answer