At December 31, Gill Company reported accounts receivable of $248.000 and an allowance for uncollectible accounts of $1,800 (debit) before adjustment. An analysis of accounts receivable suggests that the allowance for uncollectible accounts should be 3% of accounts receivable. The amount of the adjusting entry for uncollectible accounts would be Mutiple Choice O O O $1,800 $7,440, $9,240 $5.840

At December 31, Gill Company reported accounts receivable of $248.000 and an allowance for uncollectible accounts of $1,800 (debit) before adjustment. An analysis of accounts receivable suggests that the allowance for uncollectible accounts should be 3% of accounts receivable. The amount of the adjusting entry for uncollectible accounts would be Mutiple Choice O O O $1,800 $7,440, $9,240 $5.840

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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At the end of the year, Brinkley Incorporated’s balance of Allowance for Uncollectible Accounts is $2,400 (debit) before adjustment. The company estimates future uncollectible accounts to be 3% of credit sales for the year. Credit sales for the year total $119,000. What adjustment would Brinkley record for Allowance for Uncollectible Accounts using the percentage-of-credit-sales method? (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
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