# Using an Aging Schedule to Account for Bad Debts Carter Company sells on credit with terms of n/30. For the \$527,000 of accounts

Using an Aging Schedule to Account for Bad Debts

Carter Company sells on credit with terms of n/30. For the \$527,000 of accounts at the end of the year that are not overdue, there is a 91% probability of collection. For the \$194,000 of accounts that are less than a month past due, Carter estimates the likelihood of collection going down to 74%. The probability of collecting the \$101,000 of accounts more than a month past due is estimated to be 26%.

Don't use plagiarized sources. Get Your Custom Essay on
Using an Aging Schedule to Account for Bad Debts Carter Company sells on credit with terms of n/30. For the \$527,000 of accounts
Get an essay WRITTEN FOR YOU, Plagiarism free, and by an EXPERT!

2. On the basis of the schedule in part (1), prepare the journal entry at the end of the year to estimate bad debts. Assume that the credit balance in Allowance for Doubtful Accounts is \$19,950. How does this entry affect the accounting equation?
Indicate the effect on financial statement items by selecting “–” for decrease (or negative effect), “+” for increase (or positive effect) and “NE” for No Entry (or no effect) on the financial statement.

 Category Amount Estimated % Uncollectible Estimated Amount Uncollectible Current 527,000 9 47430 Past Due Less than one month 194000 26 50440 More than one month 101000 74 74740 Totals 822000 172610

2.Journal Entry

Profit and Loss A/c Dr. 152660          Assets = NE   Liabilities = NE Equity = -152660

Allowance for Doubtful Debts 152660     Assets= -152660 Liabilities= NE Equity = NE

Income Statement

Revenue – Expenses = Net Income

822000-152660 = 669340

Order NOW For a 10% Discount!
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

## Calculate the price of your order

Total price:
\$0.00

How it works?

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.

## Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.