At the end of the current year, the accounts receivable account has a debit balance of $969,000 and sales for the year total $10,990,000. The allowance account before adjustment has a debit balance of $13,100. Bad debt expense is estimated at 3/4 of 1% of sales. The allowance account before adjustment has a debit balance of $13,100. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $41,900. The allowance account before adjustment has a credit balance of $8,800. Bad debt expense is estimated at 1/2 of 1% of sales. The allowance account before adjustment has a credit balance of $8,800. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $73,000. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above.

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Providing for Doubtful Accounts

At the end of the current year, the accounts receivable account has a debit balance of $969,000 and sales for the year total $10,990,000.

  1. The allowance account before adjustment has a debit balance of $13,100. Bad debt expense is estimated at 3/4 of 1% of sales.
  2. The allowance account before adjustment has a debit balance of $13,100. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $41,900.
  3. The allowance account before adjustment has a credit balance of $8,800. Bad debt expense is estimated at 1/2 of 1% of sales.
  4. The allowance account before adjustment has a credit balance of $8,800. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $73,000.

Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above.

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