Percent of Sales Method At the end of the current year, Accounts Receivable has a balance...

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Percent of Sales Method At the end of the current year, Accounts Receivable has a balance...

Percent of Sales Method

At the end of the current year, Accounts Receivable has a balance of $595,000; Allowance for Doubtful Accounts has a debit balance of $5,500; and sales for the year total $2,680,000. Bad debt expense is estimated at 1/2 of 1% of sales.

a. Determine the amount of the adjusting entry for uncollectible accounts.
$

b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.

	Adjusted Balance Debit (Credit)
Accounts Receivable	$
Allowance for Doubtful Accounts	$
Bad Debt Expense	$

c. Determine the net realizable value of accounts receivable.
$

business accounting

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Answer 1

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Answer #1

a
Amount of the adjusting entry	13400	=26800001/21%

b
	Adjusted Balance Debit (Credit)
Accounts Receivable	595000
Allowance for Doubtful Accounts	7900 or (7900)	=13400-5500
Bad Debt Expense	13400

c
Accounts Receivable	595000
Less: Allowance for Doubtful Accounts	7900
Net realizable value	587100

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Answer 2

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Percent of Sales Method At the end of the current year, Accounts Receivable has a balance...

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