The Glass House, a glass and china store, sells nearly half its merchandise on credit. During the

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The Glass House, a glass and china store, sells nearly half its merchandise on credit. During the past four years, the following data were developed for credit sales and losses from uncollectible accounts:



The Glass House, a glass and china store, sells nearly


In 2010, The Glass House expanded its line significantly and began to sell to new kinds of customers.

Required:
1. Calculate the loss rate for each year from 2006 through 2009.
2. Determine whether there appears to be a significant change in the loss rate over time.
3. If credit sales for 2010 are $392,000, determine what loss rate you would recommend to estimate bad debts.
4. Using the rate you recommend, record bad debt expense for2010.

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