Exercise 5-68 (Algorithmic) Bad Debt Expense: Aging Method

Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year.

Accounts Receivable Age	Amount		Proportion Expected to Default		Allowance Required
Current	$310,500		0.005		$1,553
130 days past due	47,500		0.01		475
3145 days past due	25,000		0.13		3,250
4690 days past due	12,800		0.20		2,560
91135 days past due	6,100		0.25		1,525
Over 135 days past due	4,200		0.60		2,520
					$11,883

The balance in Glencoe's allowance for doubtful accounts at the beginning of the year was $50,560 (credit). During the year, accounts in the total amount of $51,232 were written off.

Required:

1. Determine bad debt expense. $

2. Prepare the journal entry to record bad debt expense.

	Bad Debt Expense
	Allowance for Doubtful Accounts
	Record adjusting entry for bad debt expense estimate

3. If Glencoe had written off $91,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed? $