Cranford Company's accounting records on December 31, 2016 provide the following information (prior to adjustment): Cash Sales
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Question:
Cranford Company's accounting records on December 31, 2016 provide the following information (prior to adjustment):
Cash Sales $ 94,000
Net Credit Sales 260,00
Total Sales (net) $354,000
Accounts Receivable 126,000
Allowance for doubtful accounts 2,100 (credit)
1. Prepare the journal entries to record the estimate of Cranford's bad debt expense for 2016 assuming: a. Bad debts are estimated to be 2% of net credit sales. b. Bad debts are estimated to be 5% of gross accounts receivable. Explain why the entries are what they are.
Related Book For
Fundamental accounting principle
ISBN: 978-0078025587
21st edition
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta
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