Fair Trader, a wholesaler of artistic works from developing regions, reports its year-end unadjusted trial balance, which

Question:

Fair Trader, a wholesaler of artistic works from developing regions, reports its year-end unadjusted trial balance, which shows accounts receivable of $16,800, allowance for doubtful accounts of $120 (credit), and sales of $56,000. Bad debts are estimated to be 0.5% of sales. Prepare the December 31 year-end adjusting entry for bad debts.

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...

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