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LMNOP Company's aging schedule of its accounts receivable is provided below: days outstanding $ outstanding probability of default 0-40 days $1,200,000 1.5% 41-70 days $800,000
LMNOP Company's aging schedule of its accounts receivable is provided below:
days outstanding | $ outstanding | probability of default |
0-40 days | $1,200,000 | 1.5% |
41-70 days | $800,000 | 5% |
71-100 days | $100,000 | 10% |
LMNOP accounts for bad debts using the allowance method. During the year, LMNOP wrote off $10,000 for accounts deemed uncollectible. If LMNOP's beginning balance in allowance for bad debts is $8,000, how much bad debt expense should LMNOP recognize for the fiscal year?
Select one:
a. $582,000
b. $68,000
c. $70,000
d. $60,000
e. $10,000
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