Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please help thank u (: Help Save & Exit Submit The Dubious Company operates in an industry where all sales are made on account. The

please help thank u (: image text in transcribed
image text in transcribed
Help Save & Exit Submit The Dubious Company operates in an industry where all sales are made on account. The company has experienced bad debt losses of 1.70% of credit sales in prior periods. Presented below is the company's forecast of sales and expenses over the next three years. Sales Revenue Bad Debt Expense Other Expenses Net Income Year 1 $ 384,000 Unknown 339,000 Unknown Year 2 $ 390,000 Unknown 341,000 Unknown 19 Year 3 $ 389,000 Unknown 338,750 Unknown Required: a. Calculate Bad Debt Expense and net income for each of the three years, assuming uncollectible accounts are estimated as 170% of sales. b. Assume that the company changes its estimate of uncollectible credit sales to 1.70% in Year 1, 2.70% in Year 2 and 2.20% in Year 3. Calculate the Bad Debt Expense and net income for each of the three years under this alternative scenario. Complete this question by entering your answers in the tabs below. Required A Required B Calculate Bad Debt Expense and net income for each of the three years, assuming uncollectible accounts are estimated as 1.70% of sales, Year 1 Year 2 Year 3 Bad Debt Expense Net Income Help Save & Exit Submit 1 The Dublous Company operates in an Industry where all sales are made on account. The company has experienced bad debt losses of 170% of credit sales in prior periods. Presented below is the company's forecast of sales and expenses over the next three years. 8 0130:58 Sales Revenue Bad Debt Expense Other Expenses Net Income Year $ 384,000 Unknown 339,000 Unknown Year 2 $ 390,000 Unknown 341,000 Unknown Year 3 $ 389,000 Unknown 338.750 Unknown Required: a. Calculate Bad Debt Expense and net income for each of the three years, assuming uncollectible accounts are estimated as 170% of sales. b. Assume that the company changes its estimate of uncollectible credit sales to 1.70% in Year 1, 2.70% in Year 2 and 2.20% in Your 3. Calculate the Bad Debt Expense and net income for each of the three years under this alternative scenario. Complete this question by entering your answers in the tabs below. Required A Required B Assume that the company changes its estimate of uncollectible credit sales to 1.70% in Year 1, 2.70% in Year 2 and 2.209 in Year 3. Calculate the Bad Debt Expense and net income for each of the three years under this alternative scenario. Year 1 Year 2 Year Bad Debt Expense Net Income

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Principles

Authors: Nformi Eugene Tawe

1st Edition

3330651032, 978-3330651036

More Books

Students also viewed these Accounting questions

Question

How many layers are there in the TCP / IP Model?

Answered: 1 week ago

Question

* What is the importance of soil testing in civil engineering?

Answered: 1 week ago

Question

Explain the concept of shear force and bending moment in beams.

Answered: 1 week ago

Question

What do you think of the MBO program developed by Drucker?

Answered: 1 week ago