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Problem 7-03 (Part Level Submission) Flint Corporation had record sales in 2020. It began 2020 with an Accounts Receivable balance of $465.000 and an Allowance
Problem 7-03 (Part Level Submission) Flint Corporation had record sales in 2020. It began 2020 with an Accounts Receivable balance of $465.000 and an Allowance for Doubtful Accounts of $35,000 Flint recognised credit sales during the year of $6,585,000 and made monthly adjusting entries equal to 5 of each month's credit sales to recognize bad debt expenses during the year, the company wrote of $36,800 of accounts that were deemed to be uncollectible, although one customer whose 4.200 account had been written off surprised management by paying the amount in full in late September. Including this surprise receipt, $6,548,000 cash was collected on account in 2020 To assess the reasonableness of the allowance for doubtful accounts, the controller prepared the following aged listing of the receivables at December 31, 2020: Probability of Collection 04 Days Account Outstanding Less than 16 days Between 16 and 30 days Between 31 and 45 days Between 46 and 60 days Between 61 and 75 days Over 75 days Amount $283.600 119.000 85,000 36,300 20.400 25,100 (d) Your answer is partially correct. Try again. What is the dollar effect of the year-end bad debt adjustment on the before-tax income? The year-end bad debt adjustment would decrease before-tax income $ 27365
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