An aging analysis of Hake Company’s accounts receivable at November 30, 2023 and 2024, showed the following:

Additional information:
1. At November 30, 2023, the unadjusted balance in Allowance for Doubtful Accounts was a debit of $3,400.
2. In 2024, $22,300 of accounts was written off as uncollectible and $2,500 of accounts previously written off was collected.

Instructions
a. Prepare an aging schedule to calculate the estimated uncollectible accounts at November 30, 2023, and November 30, 2024.
b. Calculate the carrying amount of Hake’s accounts receivable at November 30, 2023, and November 30, 2024.
c. Record the following: 

1. The adjusting entry on November 30, 2023 

2. The write-off of uncollectible accounts in 2024 

3. The collection in 2024 of accounts previously written off 

4. The adjusting entry on November 30, 2024

Taking It Further

What are the implications of the changes in the age of accounts receivable from 2023 to 2024?

Transcribed Image Text:

Number of Days Outstanding 0-30 days 31-60 days 61-90 days Over 90 days Total Estimated % Uncollectible 2.5% 6% 18% 25% November 30 2024 $190,000 40,000 65,000 75,000 $370,000 2023 $220,000 105,000 40,000 25,000 $390,000