1. Moon World Inc. generated $500,000 in credit sales. The company uses the percentage of sales method to estimate uncollectible accounts. The ending accounts receivable balance is $100,000. It was determined that 9% of revenue generated by credit sales is uncollectible. Allowance for doubtful accounts currently holds a credit balance of $10,000 prior to the adjusting entry for bad debts. What will be the ending balance of Allowance for Doubtful Accounts after recording bad debt expense?

Group of answer choices

$55,000

$445,000

$455,000

$45,000

$35,000

2. Foster James Company uses the LIFO cost flow assumption. According to its notes to the financial statements, its ending inventory for the past two years is as follows, both using LIFO and if it had used FIFO:

LIFO; FIFO

End of 2012: $1,800; $2,050

End of 2013: $1,756; $1,940

If Foster’s cost of goods sold using LIFO was $28,900 in the year 2013, what would be Foster’s cost of goods sold under FIFO?

Group of answer choices

$28,790

$28,834

$28,966

$29,054

$28,746