E6-2

Determine due date and interest on notes

Obj|1

✓ Feb. 20, $450

Determine the due date and the amount of interest due at maturity on the following notes:

E6-7

Estimating doubtful accounts

Obj|4

Newbury Bikes Co. is a wholesaler of motorcycle supplies. An aging of the company’s accounts receivable on December 31, 2012, and a historical analysis of the percentage of uncollectible accounts in each age category are as follows:

Age Interval                           Balance                                   Percent Uncollectible

Not Past Due                          $667,000                                             ½%

1 – 30 Days past due                158,000                                            2

31 -60 Days past due                   54,000                                           5

61 -90 Days past due                         20,000                                     15

91 -180 Days past due                       15,000                                     40

Over 180 Days past due                    10,500                                    75

                                                         $925,000

 Estimate what the balance of the allowance for doubtful accounts should be as of December 31, 2012.

E6-8

Entry for uncollectible accounts

Obj|4

Using the data in Exercise 6-7, assume that the allowance for doubtful accounts for Newbury Bikes Co. had a negative balance of 2$3,800 as of December 31, 2012.

   Illustrate the effects of the adjustment for uncollectible accounts as of December 31, 2012, on the accounts and financial statements