Question
I need help please make sure you following intructions !! double check your answers I Purdue Inc. s trial balance reflects the following balances before
I Purdue Inc.s trial balance reflects the following balancesbefore adjusting entries are made:
Dr. Cr.
Accounts receivable$450,000
Allowance for doubtful accounts$ 7,500
Sales revenue (all on credit)2,550,000
Sales returns and allowances120,000
Instructions
(a)Prepare the entry for estimated bad debts assuming that doubtful accounts are estimated to be 4% of gross accounts receivable.
(b)Prepare the entry for estimated bad debts under the same assumptions as (a), except that the Allowance for Doubtful Accounts has a debit balance of $7,500 instead of a credit balance.
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