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A company has sales equal to $300,000 for the year. Its Accounts receivable balance is $100,000. The average year over year bad debt is 2%.
A company has sales equal to $300,000 for the year. Its Accounts receivable balance is $100,000. The average year over year bad debt is 2%. There is a credit balance of $800 in the Allowance for Doubtful accounts. Estimated Age Accounts bad debt (days) receivable percentage 1-30 $-0- .5% 31-60 50,000 1% 61-90 20,000 3% 91-120 18,000 5% 12,000 25% $100,000 Over 120 Totals What is the net realizable value of accounts receivable at the end of the year assuming the income statement method is used? $95,000 $106,400 None of the above $94,000 $100,000
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