The aging schedule at December 31, for Gomez Inc. shows the following breakdown of total accounts receivable. Status Not past due Past due 1-30 days Amount $546,000 129,600 Past due 31-60 days 66,000 Past due over 60 days Total 16,800 $758,400 The company considers the risk of credit losses to be similar within the aging pools and estimates the following credit loss rates by pool: not past due, 0.5%; past due 1-30 days, 1%; past due 31-60 days, 2%; and past due over 60 days, 8%. The Allowance for Doubtful Accounts has a $1,800 debit balance before adjustment. What is included in the entry to adjust the Allowance for Doubtful Accounts on December 31 to its desired ending balance? Select one: ° a. A debit to Bad Debt Expense for $6,690. b. A debit to Bad Debt Expense for $8,490. c. A debit to Bad Debt Expense for $4,890. d. A debit to Bad Debt Expense for $5,370, of ev ent SS ng nc te
The aging schedule at December 31, for Gomez Inc. shows the following breakdown of total accounts receivable. Status Not past due Past due 1-30 days Amount $546,000 129,600 Past due 31-60 days 66,000 Past due over 60 days Total 16,800 $758,400 The company considers the risk of credit losses to be similar within the aging pools and estimates the following credit loss rates by pool: not past due, 0.5%; past due 1-30 days, 1%; past due 31-60 days, 2%; and past due over 60 days, 8%. The Allowance for Doubtful Accounts has a $1,800 debit balance before adjustment. What is included in the entry to adjust the Allowance for Doubtful Accounts on December 31 to its desired ending balance? Select one: ° a. A debit to Bad Debt Expense for $6,690. b. A debit to Bad Debt Expense for $8,490. c. A debit to Bad Debt Expense for $4,890. d. A debit to Bad Debt Expense for $5,370, of ev ent SS ng nc te
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 85APSA: Determining Bad Debt Expense Using the Aging Method At the beginning of the year, Tennyson Auto...
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The aging schedule at December 31, for Gomez Inc, shows the following breakdown of total accounts receivable. \table[[Status,Amount],[Not past due,$546,000
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