Question
Class Quest Company had the following balances as at January 1, 2016: Accounts Receivable $600,000 Debit Allowance for Doubtful Accounts $32,000 Credit During the fiscal
Class Quest Company had the following balances as at January 1, 2016:
Accounts Receivable $600,000 Debit
Allowance for Doubtful Accounts $32,000 Credit
During the fiscal year 2016 (Jan 1 to Dec 31 2016), the company had the following transactions:
Total Sales $7,200,000 (of which 40% represents cash sales).
Cash collected from credit customers $3,000,000
Write-offs of uncollectible accounts $22,000.
Required: If the company estimates that 2.50% of its accounts receivable balance is uncollectible, calculate the ending balance in the allowance for doubtful accounts.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started