Question: A company uses the percentage of sales approach to estimate bad debts

A company uses the percentage-of-sales approach to estimate bad debts. Sales for the year were $750,000, and gross profit was $450,000. The company estimates that 5% of sales are uncollectible.
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What is the company's estimated bad debt expense for the year? Would your answer change if the company was able to increase its gross profit from its sales?


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  • CreatedJuly 16, 2015
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