Aging Receivables and Bad Debt Expense Perkinson Corporation sells paper products to a large number...
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Accounting
Aging Receivables and Bad Debt Expense
Perkinson Corporation sells paper products to a large number of retailers. Perkinson's accountant has prepared the following aging schedule for its accounts receivable at the end of the year.
Accounts Receivable Category
Amount
Proportion Expected to Default
Within discount period
$384,500
0.004
130 days past discount period
187,600
0.015
3160 days past discount period
41,800
0.085
Over 60 days past discount period
21,400
0.200
Before adjusting entries are entered, the balance in the allowance for doubtful accounts is a debit of $7,405.
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