(39) A company's controller estimated bad debt expense using the percentage of accounts receivable method. Total sales for the year were $500,000. The ending balance in accounts receivable was $100,000. An examination of the outstanding accounts at the end of the year indicates that approximately 8% of these accounts will ultimately prove to be uncollectible. Before any adjustment, the balance in the allowance for bad debts is $1,100 (credit). Total accounts written off as uncollectible during the year were $7,700. Which debit or credit is included in the adjusting entry to record bad debt expense for the year? O Debit allowance for bad debts for $7,700. O Credit allowance for bad debts for $6,900. O Debit allowance for bad debts for $9,100. O Credit allowance for bad debts for $8,000.
(39) A company's controller estimated bad debt expense using the percentage of accounts receivable method. Total sales for the year were $500,000. The ending balance in accounts receivable was $100,000. An examination of the outstanding accounts at the end of the year indicates that approximately 8% of these accounts will ultimately prove to be uncollectible. Before any adjustment, the balance in the allowance for bad debts is $1,100 (credit). Total accounts written off as uncollectible during the year were $7,700. Which debit or credit is included in the adjusting entry to record bad debt expense for the year? O Debit allowance for bad debts for $7,700. O Credit allowance for bad debts for $6,900. O Debit allowance for bad debts for $9,100. O Credit allowance for bad debts for $8,000.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter5: Sales And Receivables
Section: Chapter Questions
Problem 65E: Average Uncollectible Account Losses and Bad Debt Expense The accountant for Porile Company prepared...
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