At each calendar year-end, Mcmichael Supply Co. uses the percent of accounts receivable method to estimate bad debts. On December 31, 2020, it has outstanding accounts receivable of $55,000, and it estimates that 2% will be uncollectible. 1. Prepare the adjusting entry to record bad debts expense for year 2013 under the assumption that the Allowance for Doubtful Accounts has (a) a $415 credit balance before the adjustment and (b) a $291 debit balance before the adjustment. 2. Compute the ending balance of the Allowance for Doubtful Accounts if it has a $291 beginning debit balance.

At each calendar year-end, Mcmichael Supply Co. uses the percent of accounts receivable method to estimate bad debts. On December 31, 2020, it has outstanding accounts receivable of $55,000, and it estimates that 2% will be uncollectible. 1. Prepare the adjusting entry to record bad debts expense for year 2013 under the assumption that the Allowance for Doubtful Accounts has (a) a $415 credit balance before the adjustment and (b) a $291 debit balance before the adjustment. 2. Compute the ending balance of the Allowance for Doubtful Accounts if it has a $291 beginning debit balance.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 4PB: Bristax Corporation recorded $1,385,660 in credit sales for the year, and $732,410 in accounts...

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