Balance

Adjustment
2
3
4
5
6

Required allowance

Adjusting entry:
1

2
 3

Bad debts
Credit sales
Accts Rec, 12.31
% of BD over AR

2014
2015
2016

2014+2015

Doubtful account exp

Allow for DA

Computation of required allowance

Nov-Dec
July-Oct
Jan - June
prior to 1.1.15

Flores Corpora
Analysis of Changes in Allow fo
For the year ended Dece

Allow for DA, 01.01.15

Provision (9,000,000 x 2%)
Recovery
Write offs (90,000+60,000)
Allow for DA, 12.31.15
Required allowance
Increase in allow

Doubtful account expense

Allow for DA

Visayas Comp
Accounts Recei
As of December 3

Balance, 12.31.14
Sales on Account
Collections(1)

Accounts writtend off

Credit memo issued for returned sales an
Balance, 12.31.15

(1) Total collections

collections within
discount period
Collections w/o disc
 2014
2015

Allow for DA. 12.31.14

Less: Accounts written off
Allow for DA. 12.31.15
Required allowance (214555 x 2%)
Adjustment
 68.00% 816,000.00 1.00% 8,160.00
15.00% 180,000.00 3.50% 6,300.00
8.00% 96,000.00 5.00% 4,800.00
5.00% 60,000.00 9.00% 5,400.00
2.50% 30,000.00 40.00% 12,000.00
1.50% 18,000.00 90.00% 16,200.00
1,200,000.00 52,860.00

Allow for DA, 01.01 30,250.00

Provision (4% x 3million) 120,000.00
Write off (108,750.00)
Allow for DA, 12.31 41,500.00
Required allowance 52,860.00
11,360.00

Doubtful account expense 11,360.00

Allowance for DA 11,360.00
 Balance Aging Distribution
GL SL 0-1 1-3 3-6 over 6 mos
197,000.00 198,240.00 93,240.00 76,820.00 22,180.00 6,000.00

(200.00)
(1,000.00) (1,000.00) (1,000.00)
2,000.00 2,000.00 2,000.00
500.00 500.00 500.00
1,440.00

199,740.00 199,740.00 95,240.00 77,320.00 22,180.00 5,000.00

1% 2% 3% 50%/20%
4,764.20 952.4 1,546.40 665.4 1600

DA expense 324.00
Alowance for DA 324.00
Allowance for DA 200
A/R 200.00
 Allowance for DA 1,000.00
A/R 1,000.00
A/R 2,000.00
Advances from customer 2,000.00
A/R 500.00
A/P 500.00
A/R (Per GL) 1,440.00
Sales 1,440.00

2014 2015 2016 2017

3,300.00 5,700.00 7,826.00 12,990.00
90,000.00 158,000.00 210,000.00 235,000.00
9,500.00 19,900.00 29,500.00 43,300.00
34.74% 28.64% 26.53% 30%

1st year 2nd year 3rd year

2500 500 300 3,300.00
4600 700 400 5,700.00
6200 1000 626 7,826.00
7,200.00

7100 1200 700 9000

79% 13% 8% 100%

account exp 12990

12990

tion of required allowance

1,140,000 2% 22800
600,000 10% 60000
400,000 25% 100000
 70,000 75% 52500
(130,000-60,000) 235300

Flores Corporation
Analysis of Changes in Allow for Doubtful Accounts
For the year ended December 31, 2015

DA, 01.01.15 130,000

(9,000,000 x 2%) 180,000
15,000
(90,000+60,000) (150,000)
DA, 12.31.15 175,000
235,300
60,300 (1)

account expense 60,300

60,300 (2)

Visayas Company
Accounts Receivable
As of December 31, 2015

546,400
2,622,832
with discount 2,050,859
without discount 848,118 (2,898,977)
writtend off (18,700)
mo issued for returned sales and allow (37,000)
214,555

2,857,960

2,009,842 Gross up P2,050.859 (2,009,859/.98)

848,118
 % of allow 16392/546400 3%
2/3 of 2014 % of allow 2%

DA. 12.31.14 16,392

ounts written off (18,700)
DA. 12.31.15 (2,308)
allowance (214555 x 2%) 4,291
6,599