Libre, Inc. has experienced bad debt losses of 4% of credit sales in prior periods. At the end of the year, the balance of Accounts Receivable is $100,000 and the Allowance for Doubtful Accounts has an unadjusted credit balance of $500. Net credit sales during the year were $150,000. Using the percentage of credit sales method, what is the estimated Bad Debt Expense for the year?
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
![View
History
Bookmarks
Window
Help
about:blank
Educo Content Framework
Consider a company that.
Lesson 9.2 Practice Mod.
uiz i
Saved
Help
Save & Exit
MC Qu. 8-76 Libre, Inc. has experienced bad debt...
Libre, Inc. has experienced bad debt losses of 4% of credit sales in prior periods. At the end of the year, the balance of
Accounts Receivable is $100,000 and the Allowance for Doubtful Accounts has an unadjusted credit balance of $500. Net
credit sales during the year were $150,000. Using the percentage of credit sales method, what is the estimated Bad Debt
Expense for the year?
Multiple Choice
$4,000
$6,000
< Prev
2 of 9
Next >
25
étv S A
MacBook
80
000
000
F10
F8
F9
F6
F7
F4
F5
F3
70
7
8.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F23812108-c764-4d8b-9922-340516473eea%2F5398a609-1ee3-4276-8137-26356000bfba%2F1mjag39_processed.jpeg&w=3840&q=75)
![](/static/compass_v2/shared-icons/check-mark.png)
Trending now
This is a popular solution!
Learn your way
Includes step-by-step video
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)