QUESTION 16 The following information applies to the questions displayed below.] On January 1, Year 2, Kincaid Company's Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $31,000 and $500, respectively. During Year 2, Kincaid reported $72,500 of credit sales, wrote off $550 of receivables as uncollectible, and collected cash from receivables amounting to $74,550. Kincaid estimates that it will be unable to collect one percent (1%) of credit sales. What is the amount of bad debts expense that will be reported on the Year 2 income statement? $725 $310 $550 $745.50 QUESTION 17 What effect will an overstatement of ending inventory at the end of Year 1 have on the amounts reported on the Year 1 financial statements? Understatement of retained earnings Overstatement of cost of goods sold OOverstatement of total assets Understatement of net income