Question
The following unadjusted balances of Echo Company are presented at September 30, 2023: Dr. Cr. Accounts receivable $100 000 Sales returns and allowances 40 000
The following unadjusted balances of Echo Company are presented at September 30, 2023:
| Dr. | Cr. | |
| Accounts receivable | $100 000 | |
| Sales returns and allowances | 40 000 | |
| Allowance for doubtful accounts | $ 2 500 | |
| Credit Sales | 750 000 |
Required:
(a) Prepare the journal entry for estimated bad debts assuming that doubtful accounts are estimated to be 6% of gross accounts receivable.
| Dr. Choose the right Answer : Accounts Receivable, Sales Returns and Allowances, Allowance for Doubtful Accounts, Bad Debt Expense | $
| |
| Cr. Choose the right Answer : Accounts Receivable, Allowance for Doubtful Accounts, Bad Debt Expense, Sales Returns and Allowances | $ |
(b) Prepare the journal entry for estimated bad debts assuming that doubtful accounts are estimated to be 1% of net sales
| Dr. Choose the right Answer : Sales Returns and Allowances, Accounts Receivable, Allowance for Doubtful Accounts, Bad Debt Expense | $ | |
| Cr. Choose the right Answer : Allowance for Doubtful Accounts,Bad Debt Expense, Accounts Receivable, Sales Returns and Allowances | $ |
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Introduction To Managerial Accounting
Authors: Peter C. Brewer, Ray H. Garrison, Eric W. Noreen
2nd Edition
0072922990, 9780072922998
