Question

(Bad Debts—Aging) Danica Patrick, Inc. includes the following account among its trade receivables.

Hopkins Company
1/1	Balance forward	700	1/28	Cash (#1710)	$1,100
1/20	Invoice #1710	1,100	4/2	Cash (#2116)	1,350
3/14	Invoice #2116	1,350	4/10	Cash (1/1 Balance)	155
4/12	Invoice #2412	1,710	4/30	Cash (#2412)	1,000
9/5	Invoice #3614	490	9/20	Cash (#3614 and part of #2412)	790
10/17	Invoice #4912	860	10/31	Cash (#4912)	860
11/18	Invoice #5681	2,000	12/1	Cash (#5681)	1,250
12/20	Invoice #6347	800	12/29	Cash (#6347)	800

Instructions

Age the balance and specify any items that apparently require particular attention at year-end

Short answer

The total balance of receivables is$1,705.

Step-by-step solution

Definition of Aging of Receivables

The process of sorting accounting receivables on the basis of time for which they are outstanding is known as the aging of receivables.

Aging of Balance

Date	Amount	Aging
Balance 1/1 $\left(\$700-\$155\right)$	$545	Over one year
4/12 (#2412) $\left(\$1,710-1,000-300\right)$	$410	8 months and 19 days
11/18$\left(\$2,000-1,250\right)$	$750	1 month and 13 days
	$1,705

All the invoices are paid by the company in full. The above three items must be investigated as to why their payments have not been made. The major concerns are opening balance and 2412.