Acc205 Principles of Accounting: P8-27A At September 30, 2012, the accounts of Mountain Terrace

Acc205 Principles of Accounting P8-27A  Accounting for uncollectible accounts using the allowance method, and reporting receivables on the balance sheet 
At September 30, 2012, the accounts of Mountain Terrace Medical Center (MTMC) include the following:                                                         
Accounts receivable                145,000                                 
Allowance for uncollectible accounts (credit balance)     3,500                                                                      
During the last quarter of 2012, MTMC completed the following selected transactions:
Dec 28   Wrote off accounts receivable as uncollectible: Regan, Co., $1,300; Owen Mac, $900; and Rain, Inc., $700          
Dec 31 Recorded uncollectible account expense based on the aging of accounts receivable, as follows                                                     
                         Age of Accounts                               
            Accounts Receivable  1-30 Days        31-60 Days      61-90 Days      over 90 Days
             $165,000         97,000             37,000             14,000             17,000
            Estimated percent uncollectible          0.3%    3.0%    30.0%  35.0%                     

1.  Journalize the transactions.                                                           
2.  Open the Allowance for uncollectible accounts T-account, and post entries affecting that account. Keep a running balance.                            
3.  Show how Mountain Terrace Medical Center should report net accounts receivable on its December 31, 2012 balance sheet. Use the three line reporting format.             
Powered by