Question
Waterway Company reports the following financial information before adjustments. Dr. Cr. Accounts Receivable $140,500 Allowance for Doubtful Accounts $3,730 Sales Revenue (all on credit)
Waterway Company reports the following financial information before adjustments. Dr. Cr. Accounts Receivable $140,500 Allowance for Doubtful Accounts $3,730 Sales Revenue (all on credit) 816,400 Sales Returns and Allowances 53,360 Prepare the journal entry to record bad debt expense assuming Waterway Company estimates bad debts at (a) 4% of accounts receivable and (b) 4% of accounts receivable but Allowance for Doubtful Accounts had a $1,540 debit balance. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) No. Account Titles and Explanation (a) (b) Debit Credit
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