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The general ledger account for Accounts Receivable shows a debit balance of $50,000. Allowance for Uncollectible Accounts has a credit balance of $1,000. Net Sales for the year were $494,000. In the past, 2 percent of sales have proved uncollectible, a nd an aging of accounts receivable accounts results in an estimate of $13,500 of uncollectible accounts. Using the percentage of net sales method, the Allowance for Uncollectible Accounts balance (after adjustment) would be:a) $8,880b) $9,880c) $10,880d) $1,000

The general ledger account for Accounts Receivable shows a debit balance of $50,000. Allowance for Uncollectible Accounts has a credit balance of $1,000. Net Sales for the year were $494,000. In the past, 2 percent of sales have proved uncollectible, a nd an aging of accounts receivable accounts results in an estimate of $13,500 of uncollectible accounts. Using the percentage of net sales method, the Allowance for Uncollectible Accounts balance (after adjustment) would be:a) $8,880b) $9,880c) $10,880d) $1,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The general ledger account for Accounts Receivable shows a debit balance of $50,000. Allowance for Uncollectible Accounts has a credit balance of $1,000. Net Sales for the year were $494,000. In the past, 2 percent of sales have proved uncollectible, a nd an aging of accounts receivable accounts results in an estimate of $13,500 of uncollectible accounts. Using the percentage of net sales method, the Allowance for Uncollectible Accounts balance (after adjustment) would be:a) $8,880b) $9,880c) $10,880d) $1,000
Transcribed Image Text:The general ledger account for Accounts Receivable shows a debit balance of $50,000. Allowance for Uncollectible Accounts has a credit balance of $1,000. Net Sales for the year were $494,000. In the past, 2 percent of sales have proved uncollectible, a nd an aging of accounts receivable accounts results in an estimate of $13,500 of uncollectible accounts. Using the percentage of net sales method, the Allowance for Uncollectible Accounts balance (after adjustment) would be:a) $8,880b) $9,880c) $10,880d) $1,000
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