Crane Company provides for doubtful accounts based on 4.5% of credit sales. The following data are available for 2020: Credit sales during 2020 $3,190,000 Allowance for doubtful accounts 1/1/20 35,500 Collection of accounts written off in prior years (customer credit was re-established) 15,300 Customer accounts written off as uncollectible during 2020 35,400 What is the balance in Allowance for Doubtful Accounts at December 31, 2020? Allowance for doubtful accounts 12/31/20 $Enter your answer in accordance to the question statement
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
| Credit sales during 2020 | $3,190,000 | |
| Allowance for doubtful accounts 1/1/20 | 35,500 | |
| Collection of accounts written off in prior years (customer credit was re-established) |
15,300 | |
| Customer accounts written off as uncollectible during 2020 | 35,400 |
What is the balance in Allowance for Doubtful Accounts at December 31, 2020?
| Allowance for doubtful accounts 12/31/20 | $Enter your answer in accordance to the question statement |
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