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Wellington Corp. has outstanding accounts receivable totaling $6.5 million as of December 31 and sales on credit during the year of $24 million. There is
Wellington Corp. has outstanding accounts receivable totaling $6.5 million as of December 31 and sales on credit during the year of $24 million. There is also a credit balance of $16,000 in the allowance for doubtful accounts. If the company estimates that 2% of its outstanding receivables will be uncollectible, what will be the amount of bad debt expense recognized for the year?
a. $372,000.
b. $ 114,000.
c. $ 146,000.
d. $ 130,000.
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