Dos Enterprises has historically reported bad debt expense of 5% of sales in each quarter. The entity followed the same procedure in the three quarters of the current year. However, in the fourth quarter, the entity determined that bad debt expense for the entire year should be P450,000. Sales in each quarter of the year were 1st quarter - P2,000,000, 2nd quarter P1,500,000, third quarter P2,5000,000 and fourth quarter P4,000,000. What amount should be recognized as bad debt expense for the fourth quarter?

Dos Enterprises has historically reported bad debt expense of 5% of sales in each quarter. The entity followed the same procedure in the three quarters of the current year. However, in the fourth quarter, the entity determined that bad debt expense for the entire year should be P450,000. Sales in each quarter of the year were 1st quarter - P2,000,000, 2nd quarter P1,500,000, third quarter P2,5000,000 and fourth quarter P4,000,000. What amount should be recognized as bad debt expense for the fourth quarter?

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter6: Business Expenses

Section: Chapter Questions

Problem 43P

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