Estimating Uncollectible Accounts and Reporting Accounts Receivable LaFond Company analyzes its accounts receivable at December 31, and arrives at the aged categories below along with the percentages that are estimated as uncollectible.

Age Group Accounts Receivable Estimated Loss %

0-30 days past due $ 180,000 1%

31-60 days past due 40,000 2

61-120 days past due 22,000 5

121-180 12,000 10

Over 180 days past due 8,000 25

Total accounts receivable $ 262,000

The unused balance of the allowance for uncollectible accounts on December 31, before any adjustments, is $1,040.

(a) What amount of bad debts expense will LaFond report in its income statement for the year?

$5,860

Explanation:

Age group                         Accounts          Estimated      Loss

                                           receivable           Loss

0-30 days past due           $180,000             1%             $1,800

31-60 days past due          $40,000              2%             $800

61-120 days past due         $22,000              5%             $1,100

121-180 days past due        $12,000               10%            $1,200

Over 180 days past due     $8,000               25%            $2,000

Total accounts receivable  $262,000                              $6,900

Bad debt expense = Total bad debts - Allowance

= $6,900 - $1,040

= $5,860

hi there, i would say your answer is:

b. there is a fixed quantity of resources and technology available.

hope that : )

answer(b) partnership';