Nature of Uncollectible Accounts The XYZ Corporation owns and operates casinos.

Question

Nature of Uncollectible Accounts

The XYZ Corporation owns and operates casinos. As of a recent year, The XYZ Corporation reported accounts receivable of $517,000 and allowance for doubtful accounts of $103,917.

Patient Care manufactures and sells a wide range of health care products. As of a recent year, Patient Care reported accounts receivable of $882,000 and allowance for doubtful accounts of $52,920.

Round all amounts to one decimal place.

a. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for The XYZ Corporation.
  %

b. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for Patient Care.
  %

Explanation / Answer

A Percentage of the Allowance for doubtful accounts to the accounts receivable for the XYZ Corporation Accounts Receivable $        5,17,000 Allowance for doubtful accounts $        1,03,917 % of allowance for doubtful accounts to accounts receivable = $ 103,917/ $517,000 = 20.1% A Percentage of the Allowance for doubtful accounts to the accounts receivable for the Patient Care Accounts Receivable $        8,82,000 Allowance for doubtful accounts $           52,920 % of allowance for doubtful accounts to accounts receivable = $ 52,920/ $ 882,000 = 6.0%

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