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Frankco Company had accounts receivable of $50,000 and net credit sales of $250,000 for May 20X2. There is a balance in the allowance account of
Frankco Company had accounts receivable of $50,000 and net credit sales of $250,000 for May 20X2. There is a balance in the allowance account of $3,500 before adjusting entries are recorded. Historically, 2% of net sales are uncollectible. If Frankco Company uses the percentage-of-sales method for uncollectibles, the balance in the allowance on May 31, 20X2 after adjusting entries are recorded should be ________.
A.) $4,500
B.) $8,500
C.)$5,000
D.)$3,500
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