Robinson, Inc. reports the following aging schedule for accounts receivable at December 31, 2015. Probability Days outstandingAmountof
Question:
- Robinson, Inc. reports the following aging schedule for accounts receivable at December 31, 2015.
Probability
Days outstanding Amount of collection
0 – 30 $87,500 98%
31 – 60 $13,500 68%
61 – 90 $9,300 30%
over 91 $2,400 5%
During 2015 gross sales were $350,000. Ninety percent of gross sales were credit sales. Management estimates that 3% of credit sales will be uncollectible. The current balance in the Allowance for Doubtful Accounts is $5,500 (credit). What amount of bad debt expense should Robinson record at the end of the year using the percentage of sales method?
Accounting Principles Part 2
ISBN: 978-1118306796
6th Canadian edition Volume 1
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Kinnear, Joan E. Barlow