Question

requirement 1. journalize the year - end adjusting entry for bad debts on the basis of the aging schedule. show the t - account for the allowance for bad debts at december 31, 2025. begin by determining the target balance of allowance for bad debts by using the age of each account
aging schedule

Explanation:

Step1: Calculate total accounts receivable

$$\begin{align*} \text{Total Accounts Receivable}&=80000 + 75000+50000 + 30000\\ &=235000 \end{align*}$$

Step2: Calculate estimated uncollectible for each age - group

• For 1 - 30 days: $80000\times0.8\%=80000\times0.008 = 640$
• For 31 - 60 days: $75000\times3.0\%=75000\times0.03=2250$
• For 61 - 90 days: $50000\times6.0\%=50000\times0.06 = 3000$
• For over 90 days: $30000\times51.0\%=30000\times0.51=15300$

Step3: Calculate total estimated uncollectible

$$\begin{align*} \text{Total Estimated Uncollectible}&=640+2250 + 3000+15300\\ &=21190 \end{align*}$$

Answer:

The total accounts receivable is $\$235000$. The estimated uncollectible amounts for each age - group are: $\$640$ (1 - 30 days), $\$2250$ (31 - 60 days), $\$3000$ (61 - 90 days), $\$15300$ (over 90 days). The total estimated uncollectible is $\$21190$.