Question
Gleim Company uses the income statement approach in estimating uncollectibles. At the end of the year, Gleim Corporation estimates that 3% of its credit sales
Gleim Company uses the income statement approach in estimating uncollectibles. At the end of the year, Gleim Corporation estimates that 3% of its credit sales of $950,000 will be uncollectible. Allowance for Doubtful Accounts has a debit balance of $3,500 before adjustment. The adjusting entry involves a debit to
A. | Bad Debts Expense and a credit to Accounts Receivable for $32,000. | ||||||
B. | Bad Debts Expense and a credit to Allowance for Doubtful Accounts for $32,000 | ||||||
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