Calistoga produce estimates bad debt expense at ½% of credit sales. the company reported accounts receivable and allowance for uncollectible accounts of $471,000 and $1,650, respectively, at december 31, 2017. during 2018, calistoga's credit sales and collections were $315,000 and $319,000, respectively, and $1,720 in accounts receivable were written off. calistoga's final balance in its allowance for uncollectible accounts at december 31, 2018, is:

Question

Elisha Cameron

Business

6 December, 19:39

Calistoga produce estimates bad debt expense at ½% of credit sales. the company reported accounts receivable and allowance for uncollectible accounts of $471,000 and $1,650, respectively, at december 31, 2017. during 2018, calistoga's credit sales and collections were $315,000 and $319,000, respectively, and $1,720 in accounts receivable were written off. calistoga's final balance in its allowance for uncollectible accounts at december 31, 2018, is:

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Jayda Randall · Answer 1

Given:

Estimated bad debts expense: 1/2% or 0.5% of credit sales.

2017

Accounts Receivable - 471,000

allowance for uncollectible accounts - 1,650

2018

Credit sales - 315,000

Credit collection - 319,000

Accounts receivable written off - 1,720

Bad debts expense 2018

315,000 * 0.5% = 1,575

Allowance for uncollectible account 2017: 1,650

less: Accounts receivable written off (1,720)

Allowance for uncollectible account (70) debit

Allowance for uncollectible account 2018:

(70) + 1,575 = 1,505

Calistoga's final balance in its allowance for uncollectible accounts at december 31, 2018, is $1,505