National Art is a new business
During its first year of operations, credit sales were $50,000 and collections were credit sales of $32,000. One account, $625 was written off. Management uses the percent-of-sales method to account for bad debts expense and estimates 2% of credit sales to be uncollectible. The ending balance of Allowance for Bad Debts account is ________.
A) $375
B) $1,000
C) $348
D) $1,628
A .2% of credit sales ($50,000 ) = the adjustment (Credit) of $1,000 to the Allowance for Bad Debts account. Because the write-off of $625 is a debit to the Allowance account, the ending balance is $375.
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Pay level: There are _____, ___, _____ paying companies
Fill in the blank(s) with the appropriate word(s).
Which of the statements below is NOT correct?
A) If two investments have the same expected return, the investment with the lower risk is preferred. B) If two investments have the same expected return, the investment with the greater risk is preferred. C) If two investments have the same expected risk, the investment with the higher expected return is preferred. D) If one investment has a higher expected return and a greater level of risk than another, it is not clear which investment is the preferred choice.