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Accounts Receivable and Credit Losses At the beginning of the year, Whitney Company had the following accounts on its books: Accounts receivable $122,000 Allowance for

Accounts Receivable and Credit Losses

At the beginning of the year, Whitney Company had the following accounts on its books:

Accounts receivable $122,000
Allowance for doubtful accounts 7,900

During the year, credit sales were $1,173,000 and collections on account were $1,150,000.

The following transactions, among others, occurred during the year:

Feb. 17 Wrote off R. Lowells account, $3,600 .
May 28 Wrote off G. Boyds account, $2,400 .
Oct. 13 Received $600 from G. Boyd, who is in bankruptcy proceedings, in final
settlement of the account written off on May 28. This amount is not included in the
$1,150,000 collections.
Dec. 15 Wrote off K. Marshalls account, $1,500 .
Dec. 31 Adjusted the allowance for doubtful accounts to 0.8% of credit sales for the year.

a. What is the amount of the Bad Debt Expense for the year? $Answer

b. Determine the ending balances of Accounts Receivable and Allowance for Doubtful Accounts using the above information. Enter all amounts as positive numbers.

Accounts Receivable Answer

Allowance for Doubtful Accounts Answer

c. What would appear on the balance sheet for the net realizable value of accounts receivable at December 31? $Answer

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