Chegg

Required information

$[$The following information applies to the questions displayed below.$]$

At December $31,$ Hawke Company reports the following results for its calendar year.

Cash sales

Credit sales

$$340,000$

$$850,000$

In addition, its unadjusted trial balance includes the following items.

Accounts receivable

Allowance for doubtful accounts

$$765,000$ debit

$$6,100$ debit

$2.$ Bad debts are estimated to be $4\%$ of credit sales. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December $31$ balance sheet.

Answer is complete but not entirely correct.

Current assets:

Accounts receivable

$$765,000$

ess: Allowance for doubtful accounts

$$734,400$