Question: Trophy Fish Company supplies flies and fishing gear to sporting

Trophy Fish Company supplies flies and fishing gear to sporting goods stores and outfitters throughout the western United States. The accounts receivable clerk for Trophy Fish prepared the following partially completed aging of receivables schedule as of the end of business on December 31, 2013:

The following accounts were unintentionally omitted from the aging schedule:

Trophy Fish has a past history of uncollectible accounts by age category, as follows:
Age Class Percent Uncollectible
Not past due .......... 1%
1–30 days past due ....... . 2
31–60 days past due ....... 10
61–90 days past due ....... 30
91–120 days past due ........ 40
Over 120 days past due ...... 80

1. Determine the number of days past due for each of the preceding accounts.
2. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals.
3. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule.
4. Assume that the allowance for doubtful accounts for Trophy Fish Company has a debit balance of $3,600 before adjustment on December 31, 2013. Journalize the adjusting entry for uncollectible accounts.
5. Assume that the adjusting entry in (4) was inadvertently omitted, how would the omission affect the balance sheet and incomestatement?
View Solution:

Sale on SolutionInn
  • CreatedFebruary 28, 2014
  • Files Included
Post your question