On January 1, ABC Company had $190,000 in Accounts Receivable and during the month had Credit sales
Question:
On January 1, ABC Company had $190,000 in Accounts Receivable and during the month had Credit sales of $370,000 and Cash sales of $200,000. During January, ABC collected $310,000 on account and wrote off a $12,000 receivable. Also, during January, ABC had Sales Allowances of $9,000; Sales Discounts of $16,000; and Sales Returns of $17,500. ABC managed to collect $3,800 of a previously written off account during January. The balance in the Allowance for Uncollectible Accounts on January 1 was $15,800.
Assuming that ABC estimates Bad Debt as 5% of accounts receivable, what is the adjusting entry for bad debt expense?
Acct Rec | Allow for Uncollect Accts | |||||||||||||||||||||||||||||||||||||
Beg. 190,000 | Beg 15,800 | |||||||||||||||||||||||||||||||||||||
310000 | 12,000 | |||||||||||||||||||||||||||||||||||||
3800 | ||||||||||||||||||||||||||||||||||||||
End 491800 |
|
Accounting Principles
ISBN: 978-0470533475
9th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso