Here is information related to Waterway Industries for 2017. Total credit sales $1,480,000 Accounts receivable at December 31 740,000 Bad debts written off 38,800

(a) What amount of bad debt expense will Waterway Industries report if it uses the direct write-off method of accounting for bad debts?correct answer 38800

(b) Assume that Waterway Industries decides to estimate its bad debt expense based on 4% of accounts receivable. What amount of bad debt expense will the company record if Allowance for Doubtful Accounts has a credit balance of $3,200?

(c) Assume the same facts as in (b), except that there is a $1,000 debit balance in Allowance for Doubtful Accounts. What amount of bad debt expense will Waterway Industries record?