Question
Percent of Sales Method At the end of the current year, Accounts Receivable has a balance of $440,000; Allowance for Doubtful Accounts has a debit
Percent of Sales Method
At the end of the current year,Accounts Receivablehas a balance of $440,000;Allowance for Doubtful Accountshas a debit balance of $4,000; and sales for the year total $1,980,000.Bad debt expenseis estimated at 1.25% of sales.
a.Determine the amount of the adjusting entry for uncollectible accounts. $
b.Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.
Adjusted Balance Debit (credit)
Accounts Receivable $
Allowance for Doubtful Accounts $
Bad Debt Expense $
c.Determine thenet realizable valueof accounts receivable. $
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