Assume that you have a company. And the management estimates that 1% of sales will be uncollectible.
Give any amount of sales and prepare the journal entry using the percent of sales method.
According to percent of sales method, bad debt expense will be calculated as under:
Bad Debt Expense = Net sales x Percentage estimated as uncollectible
Example- Let us assume that total net sales of ABC Company for the year is $100,000. ABC Company estimates uncollectible accounts at 1% of total net sales. ABC Company would make the following adjusting entry at year end:
Bad debt expense = 100,000 x 1%
= $1,000
Dec. |
31 |
Bad Debt Expense |
Debit 1,000 |
Credit |
Allowance for Doubtful Accounts | 1,000 | |||
To record estimated uncollectible accounts | ||||
($100,000 X 1%). |
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Assume that you have a company. And the management estimates that 1% of sales will be...
Assume that you have a company. And the management estimates that 5% of sales will be uncollectible. Give any amount of sales and prepare the journal entry using the percent of sales method.
Assume that you have a company. And the management estimates that 2.5% of sales will be uncollectible. Provide an amount of sales and prepare the journal entry using the percent of sales method?
please use a new word. thank you
Assume that you have a company. And the management estimates that 2.5% of sales will be uncollectible. Provide an amount of sales and prepare the journal entry using the percent of sales method (I Mark).
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