Reference no: EM132564096

Moore Company had a $700 debit balance in Allowance for Doubtful Accounts at December 31, 2017, before the current year's provision for uncollectible accounts. An aging of the accounts receivable revealed the following:

                                                                   Estimated Percentage of Uncollectible

Not yet due             $120,000                        1%

1-30 days                   12,000                       3%

31-60 days past           10,000                      6%

61-90 days past              5,000                   12%

Over 90 days past             8,000                  25%

Total Accounts Receivable $155,000

Required:

Question 1: Which approach of recording bad debts is followed by company?

Question 2: Prepare the adjusting entry on December 31, 2017 to recognize bad debts expense.

Question 3: By looking at the aging schedule, do you think there is any threat to company regarding receivable collection why or why not?