At December 31, 2016, retailer Susan Bicycles had a balance of $330,400 in its Accounts Receivable account and an unused balance of $1,120 in its Allowance for Uncollectible Accounts account. The company analyzed and aged its accounts receivable based on the following estimated uncollectible amounts:
1.2% of current balances of $174,000
4.4% of balances 31-60 days of $88,400
10.8% of balances of 61-90 days of $35,600
42.0% of balances over 91 days of $32,400
The company bases its provision for credit losses on the aging analysis.
A. What amount of bad debt expense will Susan Bicycles report in its 2016 income statement?
B. How would Accounts Receivable and the Allowance for Uncollectible Accounts appear in its December 31, 2016, balance sheet?
C. Why might Susan Bicycles opt to extend terms of credit on sales?

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The Answer of At December 31, 2016, retailer Susan Bicycles had a balance of $330,400 in its Accounts Receivable account and an unused balance of $1,120 in its Allowance for Uncollectible Accounts account. The company analyzed and aged its accounts receivable based on the following estimated uncollectible amounts:
1.2% of current balances of $174,000
4.4% of balances 31-60 days of $88,400
10.8% of balances of 61-90 days of $35,600
42.0% of balances over 91 days of $32,400
The company bases its provision for credit losses on the aging analysis.
A. What amount of bad debt expense will Susan Bicycles report in its 2016 income statement?
B. How would Accounts Receivable and the Allowance for Uncollectible Accounts appear in its December 31, 2016, balance sheet?
C. Why might Susan Bicycles opt to extend terms of credit on sales?

At December 31, 2016, Retailer Susan Bicycles Had a Balance