Foster Co. adjusted its allowance for bad debts at the end of the year. The general ledger balances for accounts receivable and the related allowance account were $1,000,000 and $40,000, respectively. Foster uses the accounts receivable percentage method to estimate its allowance for bad debts. Accounts receivable were estimated at 5% uncollectible. 

What amount should Foster record as an adjustment to his allowance for bad debts at the end of the year?

Answer rating: 100% (QA)

To determine the adjustment to the allowance for bad debts at the end of the year we need ... View the full answer