Ruby Red manufactures, markets, and distributes citrus flavored soft drinks across the globe. Ruby Red hired a
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Question:
Ruby Red manufactures, markets, and distributes citrus flavored soft drinks across the globe. Ruby Red hired a collection agency in 2012 to increase collection rates from customers. As a result, Ruby estimates that only 2% of its 2013 credit sales will be written off, compared to the 4% of 2012’s credit sales that were estimated to be uncollectible. At December 31, 2013, Ruby Red has a $12,800 credit balance in its allowance for doubtful accounts and credit sales of $1,570,000.
Required:
Use the percentage of credit sales method to calculate the bad debt expense.
Related Book For
Financial Accounting
ISBN: 978-0078025556
8th edition
Authors: Robert Libby, Patricia Libby, Daniel Short
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