Problem 5-6 (PHILCPA Adapted) At the beginning of current year, Rampant Company reported that the allowance for doubtful accounts has a credit balance of P170,000. Bad debt recoveries and bad debts...

1. What is the required allowance for doubtful accounts at year-end?

2. How much would be the doubtful accounts expense for the current year?

Please include solutions with the answers. Thank you.

Extracted text: Problem 5-6 (PHILCPA Adapted) At the beginning of current year, Rampant Company reported that the allowance for doubtful accounts has a credit balance of P170,000. Bad debt recoveries and bad debts written off in the current year were P30,000 and P235,000, respectively. The allowance account had been previously calculated as a percentage of net sales. It was decided however to provide for doubtful accounts commencing with the year-end adjusting entry on the basis of an analysis of the age of the receivables. The following schedule was prepared. Percent uncollectible Not yet due 1-30 days past due 31-60 days past due 61-90 days past due Over 90 days past due Additional accounts to be written off 1,700,000 1,200,000 100,000 150,000 120,000 30,000 NIL 5 · 25 50 100