On January 1, the Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $40,000...

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On January 1, the Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $40,000 and $1,500 respectively. During the year, the company reported $80,000 of credit sales. There were $500 of receivables written off as uncollected during the year. Cash collections of receivables amounted to $78,200. The company estimates that it will be unable to collect 4% of the year-end accounts receivable balance. The amount of bad debts expense recognized in the income statement will be: O $1,450 O $142 O $652 O $1,652 On January 1, the Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $40,000 and $1,500 respectively. During the year, the company reported $80,000 of credit sales. There were $500 of receivables written off as uncollected during the year. Cash collections of receivables amounted to $78,200. The company estimates that it will be unable to collect 4% of the year-end accounts receivable balance. The amount of bad debts expense recognized in the income statement will be: O $1,450 O $142 O $652 O $1,652

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The correct option is C 652 3D Explanation Calaculation of amount of Bad Debt e... View the full answer