Ask Question
28 December, 12:09

On December 31 of the current year, the unadjusted trial balance of a company using the percent of receivables method to estimate bad debt included the following: Accounts Receivable, debit balance of $95,250; Allowance for Doubtful Accounts, credit balance of $921. What amount should be debited to Bad Debts Expense, assuming 6% of outstanding accounts receivable at the end of the current year are estimated to be uncollectible?

A. $5,715.

B. $6,636.

C.$4,794.

D. $5,770.

E. $5,660.

+5
Answers (1)
  1. 28 December, 12:22
    0
    amount debited to bad debt expenses = $4794

    so correct option is C.$4,794

    Explanation:

    given data

    Outstanding account receivable = 95250

    credit balance of allowance for doubtful account = 921

    rate = 6 %

    solution

    we get here Allowance for doubtful accounts that is

    Allowance for doubtful accounts = 6 % of 95250

    Allowance for doubtful accounts = 5715

    and

    so here amount should be debited to bad debt expenses is

    amount debited to bad debt expenses = 5715 - 921

    amount debited to bad debt expenses = $4794

    so correct option is C.$4,794
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “On December 31 of the current year, the unadjusted trial balance of a company using the percent of receivables method to estimate bad debt ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers