Sonic has the following information: Income statement method used to estimate un-collectible accounts. Company bases estimate on ALL sale. Cash sales = $1.540.123 Credit sales = $385,000 Accounts Receivable = $989,000 Existing CREDIT balance in the Allowance for Doubtful Accounts = $10.200 Bad Debts are estimated at this % of ALL sales = 3.00% Fill in the missing amount in the following adjusting journal entry: Bad Debt Expense $??? Allowance for Doubtful Accounts $??? ROUND YOUR ANSWER TO THE NEAREST WHOLE DOLLAR AND DO NOT USE $ DOLLAR SIGNS.
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.
Sonic has the following information:
Income statement method used to estimate un-collectible accounts.
Company bases estimate on ALL sale. Cash sales = $1.540.123
Credit sales = $385,000
Existing CREDIT balance in the Allowance for Doubtful Accounts = $10.200
Fill in the missing amount in the following
Bad Debt Expense $???
Allowance for Doubtful Accounts $???
ROUND YOUR ANSWER TO THE NEAREST WHOLE DOLLAR AND DO NOT USE $ DOLLAR SIGNS.
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