Average Uncollectible Account Losses and Bad Debt Expense The accountant for Porile Company prepared the following data for sales and losses from uncollectible accounts: Losses from Year Credit Sales Uncollectible Accounts* 2015 $866,000 $11,125 2016 952,000 14,840 2017 1,083,000 16,790 2018 1,189,000 16,850 *Losses from uncollectible accounts are the actual losses related to sales of that year (rather than write-offs of that year). Required: 1. Calculate the average percentage of losses from uncollectible accounts for 2015 through 2018. Enter your answer as percentage, rounded to one decimal place (e.g. .0248563 to 2.5%). 1.45 x % 2. Assume that the credit sales for 2019 are $1,300,000 and that the weighted average percentage calculated in Requirement 1 is used as an estimate of losses from uncollectible accounts for 2019 credit sales. Determine the bad debt expense for 2019 using the percentage of credit sales method. Round your answer to the nearest dollar. 5.031 X

Average Uncollectible Account Losses and Bad Debt Expense The accountant for Porile Company prepared the following data for sales and losses from uncollectible accounts: Losses from Year Credit Sales Uncollectible Accounts* 2015 $866,000 $11,125 2016 952,000 14,840 2017 1,083,000 16,790 2018 1,189,000 16,850 *Losses from uncollectible accounts are the actual losses related to sales of that year (rather than write-offs of that year). Required: 1. Calculate the average percentage of losses from uncollectible accounts for 2015 through 2018. Enter your answer as percentage, rounded to one decimal place (e.g. .0248563 to 2.5%). 1.45 x % 2. Assume that the credit sales for 2019 are $1,300,000 and that the weighted average percentage calculated in Requirement 1 is used as an estimate of losses from uncollectible accounts for 2019 credit sales. Determine the bad debt expense for 2019 using the percentage of credit sales method. Round your answer to the nearest dollar. 5.031 X

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 65E: Average Uncollectible Account Losses and Bad Debt Expense The accountant for Porile Company prepared...

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