Question
For the year ended December 31, 2020, Absolute Inc. estimated its allowance for doubtful accounts using the year-end aging of accounts receivable. Additional information for
For the year ended December 31, 2020, Absolute Inc. estimated its allowance for doubtful accounts using the year-end aging of accounts receivable. Additional information for calendar 2020 follows:
Allowance for doubtful accounts, beginning...........................$44,000
Estimated uncollectible accounts during 2020
(1.5% of credit sales of $5,000,000)............................75,000
Uncollectible accounts written off during year.........................88,000
Uncollectible accounts recovered during year..........................24,000
Estimated uncollectible accounts per year-end aging.............118,000
For the year ended December 31, 2020, Absolute Inc.'s bad debt expense should be
a) Debit $63,000.
b) Debit $55,000.
c) Credit $55,000.
d) Credit $85,000.
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