Question: At December 31 2010 before any year end adjustments the accounts receivable

At December 31, 2010, before any year-end adjustments, the accounts receivable balance of Digital Electronics Company is $150,000. The allowance for doubtful accounts has a $6,800 credit balance.
Digital Electronics Company prepares the following aging schedule for accounts receivable:

1. Based on the aging of accounts receivable, is the unadjusted balance of the allowance account adequate? Too high? Too low?
2. Make the entry required by the aging schedule. Prepare a T-account for the allowance.
3. Show how Digital Electronics Company will report Accounts Receivable on its December 31 balancesheet.

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  • CreatedDecember 10, 2012
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