Customer total not yet 1-30 30-60 60-90 over 90
Due
Acc.

Balance forward $793,791 438,933 149,614 106,400 57,442 41,402



I have to complete with these accounts

J.Kras $11,077 due Jan 15
T.Lopez 9,314 due Feb 15(next fiscal year)
L.Zapal 8,664 due Dec.20
R.Caputo 14,710 due Jan 4
S.Smith 6,316 due Nov 15
A.Quinn 4,389 due Mar.1(next fiscal year)
$55,250


Not due yet 2
1-30 5
31-60 15
61-90 25
Over 90 days 50
This is the percentage considered uncollectable

The date is now Jan.31,2011 beginng date Feb,1 ,2010

Please help anyone I need to complete the aging analysis of accounts recievable.

It looks like you posted the same question twice. Have you done the aging schedule yet? If you don't know what that is, you can find it in your textbook or online. It's a schedule that lists the accounts and spreads them by columns (1-30 or "current", 31-60, etc). Once you have that you can apply the percentages that are estimated to be uncollectible. If you'll do that to your best ability and post what you have, we can check to see if you understand. Thanks.

I don't have room to do it like I have it done. I do have these in columns:
Accounts
Balance 849,041
Allowence for uncollectible is 87,002.
This part of the question I did fine the part I don't understand is I'm suppose to compute the end-of-year balances(before adjustments) of accounts recievable and allowances for uncollectible accounts.

On my work it shows Accounts recievable was a debit of $442,341 and the balance for allowance for uncollectible accounts was a credit of $43,700. During the year the store had a sales on account of $3,722,000, a sales return and allowance of $60,000, worthless accounts written off $44,300, and collections from custormers of $3,211,000. What I don't understand is what does compute mean and what do I compute. I also have to prepare an analysis computing the estimated uncollectible accounts.
I can do the rest of my work I just don't understand this part I did the first part which was my original question, any help will be appreciated.

Okay, let's see if we can work through this together. First, it looks like you have a mistake in this question. When I added up the "have to complete with these accounts" part they do not equal $55,250. I looked at your other post and saw that the $780 figure is missing. Did you have that in your work?

I see where the $849,041 comes from, but I'm getting a different answer than $87,002. Can you tell me what you have for a total under each of the columns:
Not due yet 2
1-30 5
31-60 15
61-90 25
Over 90 days 50


Once we are in agreement there, we can figure out the rest. Thanks.

Yes I can and thank you for your help.
In the not yet due I have a total of 9,053
1-30 23,424
31-60 16,907
61-90 16,527
0ver 90 21,091
This is after I did the percentage that's where I came up with 87,002 of course I rounded up on this. I forgot to add the 780 figure to this one it would have been been in my over 90 days that's why I have the figure of 87,002 hope this has helped you and maybe you can help me thank you.

We are in agreement on the not yet due and over 90 columns. Tell me the numbers you have in your 1-30 column.

I have $23,424 in the 1-30 column

All my numbers are
149,614
11,077
14,710

Total I have is 175,401
After the percentages
Then I have the total of 23,424

What I need to know is this: You got $23,424 by applying 5% to the total A/R in the 1-30 day balance. My number is much lower, so we have different totals for that column. I'd like to see what numbers you used to get your total.

Sorry, we were posting at the same time. Okay, the $175,401 is correct, but to get $23,424 you would have to apply over 13%. Can you explain how you did this?

I now have 8770 is this correct I must have miss or hit another number on my caculator.

Yes. We have differences in the 30-60 and 60-90 columns. Why don't you give me the same info and we'll see what's going on?

31-60
106,400
6,316
Total I have is 112,716 then 16,907

61-90
57,442
780
Total I have is 42,182 then 21,091

Take a look at your $6316 and see if it is in the right column. What about L Zappal? You had mentioned earlier that the $780 belongs in the over 90 column, but here you have it in the 61-90 day column, and the $57,442 + 780 = $42,182 doesn't make sense. I think you have your columns mixed up.

Sorry in my 61-90 days the total is suppose to be 66,106 then 16,527 I looked at the wrong column

57,442
8,664

Look at how you spread L Zappal and S Smith.

6,316 due date is nov 15 so from feb 1 I had 31-60 days

Due Nov 15 - 15 days left in Nov + 31 in Dec + 31 in jan = 77

Ok I may need you to help me with the dates .
11,077 is due jan 15
8664 is due dec 20
14,710 due jan 4

You have the 11,077 and 14,710 in the 1-30 day column. You are right with that. If 11077 was due Jan 15 and is outstanding at Jan 31 it is 16 days past due.

You have the 8664 in the 60-90 day column. Can you tell me how many days past due it is?

I did some switching numbers around here are my new totals

31-60
106,400
8664
Total 115,064 then 17,260

61-90

57,442
6316
Total 63,758 then 15,940

I'm trying to help at the same time

Those numbers are right. Good job. So what do you have instead of the 87,002 now?

I have 72,114 now for the total.

I hope I'm getting closer because I need these for this partThis part of the question I did fine the part I don't understand is I'm suppose to compute the end-of-year balances(before adjustments) of accounts recievable and allowances for uncollectible accounts.

On my work it shows Accounts recievable was a debit of $442,341 and the balance for allowance for uncollectible accounts was a credit of $43,700. During the year the store had a sales on account of $3,722,000, a sales return and allowance of $60,000, worthless accounts written off $44,300, and collections from custormers of $3,211,000. What I don't understand is what does compute mean and what do I compute. I also have to prepare an analysis computing the estimated uncollectible accounts.
I can do the rest of my work I just don't understand this part I did the first part which was my original question, any help will be appreciated

$72114 is okay. I took all my numbers to two decimals and got a slightly different answer - like $1 different.

We might need to talk a little about the next part. What do you mean by: On my work it shows Accounts recievable was a debit of $442,341. Was that given to you in the problem? Is that possibly the amount A/R increased during the year or the beginning balance? The balance in the A/R account at 1/31 should equal your detail.

I want to make sure I am getting the right info here. Typically with the allowance for uncollectibe accounts, you will have a credit balance on the books. You will do an analysis like we just did to find out the estimated amount that you need, and then adjust the books to equal that.

I copied it like it was printedthe balance of accounts receivable was a debit of 442,341, and the balance of Allowance for uncollectible accounts was a credit of 43,700. During the year the store had sales on account of 3,722,00,sales returns and allowances of 60,000, worthless accounts written off 44,300, and collections from custormers of 3,211,000

So this is what I'm suppose to do now.
Compute the end-of year balances(before adjustments) of Accounts Recievable and Allowances for Uncollectible Accounts.

Prepare an analysis computing the estimated uncollectible accounts.

Then I figure the estimated uncollectible accounts expense for the year.

We completed the age analysis so I think we use it. So the new balance would be what we just did. I'm not sure

The 43,700 credit was the beginng balance before we did the analysis.

Okay, I see what they are saying. Your beginning balance in A/R was $442,341. I want you to do this work, so take the beginning balance, and adjust it by the transactions. You know your sales and your collections. The difference are accounts that haven't been paid yet. Also adjust by Returns & Allowances. When you write off bad debts, do you know the entry? I don't want to just give you the answers, but tell me what you think it is and we'll work through it. That way I know it will make sense to you when we are done.

When you have done that, we'll work on the Allowance for Doubtful Accts portion.

Also, ask if you don't understand the Returns & Allowances account.

Thanks for not giving me the answers I need to know how to do this. I think the entry would be Accounts recievable write off account,if you are talking about the journal entry. We did not go over any of this in class so I'm really just winging this and using your help.

No, not the journal entry yet. I want you to start with the beginning balance in A/R of $442,341 and then adjust it by the transactions (Sales, Returns, Collections, etc.). I think once you have done this, the whole problem is really going to make sense to you.

I'm guesing here but I think A/R would be 7,375,341
Uncollectible accounts I have 103,700

Then a write off 43,000

Now am I suppose to add the write off with the accounts uncollectible

43,300 is the write off, sorry about that.

It looks like you are basically just adding most of those numbers. You need to think about what effect each would have on A/R. At the time of a sale, a/r is increased. What happens with a collection? Do you understand what they mean by collection?

Let's just work with a/r for a moment. Don't look at uncollectibles until you understand a/r.

I was thinking collections was when someone didn't pay his/her debt.
Thanks for your help this is just my fourth class. Accounts recievable is when a company is going to receive cash.
I'm sorry I don't know much yet.

No, I understand why you said that - like someone "gets sent to collections". Here it means that was the amount of A/R that were collected, meaning the customer paid his bill.

Don't worry about it. You are working at it, and if you keep this up you will understand it soon. It is really important as Accounting builds on all these fundamentals, and if you understand this now it will make all your work easier in the future.

Okay, knowing what collections are, how does that affect your a/r number?

I have so far a total of 883,341,but that's without the write off which I have no clue as how to do. I'm also guessing that store returns are a decrease in A/R

Ingonore last post

If the collections were already collected then that wouldn't mean they are reievable would it?

I'm trying to figure out your 883341 number. Tell me how you got it. I promise we are getting closer. :)

If the collections were already collected then that wouldn't mean they are reievable would it?

When a sale is made, you debit A/R and credit Sales. When a collection is made, you debit cash and credit A/R. In other words, a collection decreases A/R. You have been paid - it is no longer receivable.

I just added 3,211,00 and 60,000 together then subtracted from the 3,722,000 got 441,000 then added that to the balance in A/R at the beginning of course this is without the write off which I don't know about yet.

I think you have an addition error there. That comes to $451,0000 not $441,000

Okay, just one thing you are missing. $44,300 of accounts were written off. This means the company decided they were not collectible. It is different from determining the allowance where you are estimating what won't be collected. Here, they are saying that $44,300 in accounts should be zeroed out (removed from a/r) as they won't collect them. Instead of doing this based on percentage, it would involve a detailed look by customer and identifying those specific accounts that will not pay.

Is this making sense to you?

Yes that makes sense,I'm adding my head instead of with a caculator. So am I getting any closer.

Yes, just tell me what you would do with the $44,300. When you adjust for that, if you do it right, you will get a familiar number - and I'm hoping this will really make sense to you at that point.

I know my familiar should be 793,791 but I must have something wrong because I'm not getting that number.

What number did you get? PS - you are on the right track.

I got 893,341 so I'm off along way

You had $893,341 before adjusting for the $44,300. Remember, those are accounts the company specifically identifies to be written off because they won't be collected. What does that do to your $893,341?

I don't know if I subtract 43,300 I still do not come up with 793,791 I get 850,041 which is 1000 off my total of balance on my age analysis which was 849,041.

You should be using 44,300 not 43,300.

OMG thank you so much I have to learn to double check my numbers to make sure I use the correct one. Now if you can tell me what they mean by to prepare an analysis computing the estimated uncollectible accounts I will work on this and you can check my work tom. It's after 1:00 am and I'm tired.

Okay, just a review:

442,341 …... Beginning A/R
+3,722,000.…Sales
-3,211,000 .….Collections
-60,000………Returns and Allowances
-44,300………Bad Debts Written Off

=849,041…….. Ending Balance – agrees to your detailed aging


The whole point of this is to make sure you understand the question and the flow of transactions.



Your questions: So this is what I'm suppose to do now.
Compute the end-of year balances(before adjustments) of Accounts Receivable and Allowances for Uncollectible Accounts. You'll work on the Allowance for Uncollectible Accounts next. You have the beginning balance stated in your question. Which of the numbers given would affect it? Why don't you write it similar to what I did above, but it will be much simpler. This will give you the unadjusted balance they are asking for in the question.

Prepare an analysis computing the estimated uncollectible accounts. You have done this already - your $72,114 amount.

Then I figure the estimated uncollectible accounts expense for the year. You are going to compute your current balance and you have already computed your estimated balance. The difference is your current year expense.

Good luck. If you'll attempt this and show your work, I'll look at it tomorrow. Good night. :)

Here goes.
43,700 Beginning Allowance
+60,000 Returns and allowances
103,700 ending balance, If I add the write off then I have a toatl of148,000

I should have kept on going last night when I was beginning to understand I know how we did the other just got to get this part.

103,700
-72,114
=31,114 current year expense this is with out the write off
148,000
-72,114
=76,886 this is with the write off. I need to learn if this affects this or not

Just let me know if I'm going in the right directions or if I'm completely off base and thank you for your time and help.

Returns and Allowances affect Accounts Receivable and Sales (as Sales Returns and Allowances are deducted from Sales on the Income Statement), not the Allowance for Uncollectible Accounts. Sales Returns occur when customers return defective, damaged, or otherwise undesirable products to the seller. Sales Allowances occur when customers agree to keep such merchandise in return for a reduction in the selling price. Does it make sense to you that this does not affect the Allowance for Uncollectibles? You are looking for the amount in your problem that would have been adjusted to the allowance. When you see that number, give some thought as to how it would affect the allowance. You might reread your textbook regarding the Allowance for Uncollectible Accounts account.

I have been reading and it's all confusing I don't even know where to begin. I have a beginning balance of 43,700 then the only thing that I see that would affect the allowance is the write off 44,300. From here I'm lost I can add and have a total of 88,000 but then since I don't understand I'm just guessing.

Okay, let me see if I can explain it to you. At the beginning of the year, you had a balance in the Allowance for Uncollectible Accounts of $43,700. That means that (just as you computed the $72,114 figure) at the end of last year they used their experience and formulas to estimate that $43,700 in A/R would not be paid by the customers. It's only an estimate at this time. During the current year, they did an actual analysis by customer and determined that $44,300 should be written off. This means that they specifically identified $44,300 in A/R invoices that would not be received. The entry at this point would be to debit the Allowance and credit the A/R. They would do this by customer so that the aging of A/R would equal the new A/R balance when it was decreased by $44,300. Currently, you have:

$43,700... Beginning Allowance balance
-44,300... A/R written off
=($600)... Ending Allowance balance, prior to adjustment.

In this case, they slightly underestimated the balance. This is nothing unusual in that it is always just an estimate.

You have calculated that you need a balance of $72,114. Given that the current balance is ($600), what do you need to add to the account to have the estimated balance you need?

Ok I will work with this and post my answer in a few minutes I want to take my time, thanks for helping me

I'm proably wrong but I have done this a couple of ways and the only way I can come up with the balance I need is to add the 72,114 to 44,300 and then I have 116,414. When I then take away the 44,300 I have the balance I need. Is this the correct way or just a wrong way with a correct answer?

Try reading my post again. You currently have a negative $600 balance. You want a positive $72,114 balance.

I'm wondering if you put the $44,300 in your last answer twice in error. You are not dealing with the beginning balance of $43,700.

I'm stuck,I have read the chapter over and over and there is nothing on how to get a negative balance to be the positive balance I want need it to be. I'm beginning to feel dumb and I know in the end this is going to be so simple.

It is simple math. Let me give you an example.

If you have a balance of negative 100 and you need a balance of 1000 you add 1100.

(100) + 1100 = 1000

Or even simpler, you have -1 and you want 5, you add 6.

-1 + 6 = 5

The only difference here is you are dealing with debits and credits. The math is the same.

Let me see if I understand,I know that with the simple math
-600+72,714=72,114

Now how would this be form for accounting or is it just this simple or do I have to have the 72,714 be listed as an adjustment. I'll let you explain or I'll confuse both of us.

Haha, that last line made me laugh. It is just that simple.

$43,700... Beginning Allowance balance
-44,300... A/R written off
=($600)... Ending Allowance balance, prior to adjustment.
+ 72,714... Credit to Allowance account
= $72,114... Ending Allowance balance, after adjustment


You need to make an entry to the Allowance of $72,714 with the debit being Bad Debt Expense. I'm not sure how much you are working with debits and credits yet. I could explain using those terms but I don't want to confuse you if you aren't comfortable with debits and credits yet.

Debits and credits are still very new to me.
Thank you so much and I'm sure you will see me a lot until I understand this. Now can you walk me through the uncollectible accounts expense. Would that be the total from the beginning 43,700 then take that away from 72,114 or have I lost site again.

That is the $72,714, There are two sides to the entry - $72,714 dr to the expense and $72,714 credit to the allowance.

Thank you, I have completed this assignment with you help and you made me work and thanks for that or else I will never get this. You are a very patient person.

You're welcome. I hope you will read the whole thread over again and make sure you understand it. I can guarantee it will come in useful in the future. Good luck.