The unadjusted trial balance at year-end for a company that uses the percent of receivables method to determine its bad debts expense reports the following selected amounts: Accounts Receivable $ 434,000 Debit Allowance for Doubtful Accounts 1,360 Debit Net Sales 2,210,000 Credit All sales are made on credit. Based on past experience, the company estimates 2.0% of ending accounts receivable to be uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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The unadjusted trial balance at year-end for a company that uses the percent of receivables method to
determine its bad debts expense reports the following selected amounts:
Accounts Receivable $ 434,000 Debit
Allowance for Doubtful Accounts 1,360 Debit
Net Sales 2,210,000 Credit
All sales are made on credit. Based on past experience, the company estimates 2.0% of ending accounts
receivable to be uncollectible. What adjusting entry should the company make at the end of the current
year to record its estimated bad debts expense?
Transcribed Image Text:The unadjusted trial balance at year-end for a company that uses the percent of receivables method to determine its bad debts expense reports the following selected amounts: Accounts Receivable $ 434,000 Debit Allowance for Doubtful Accounts 1,360 Debit Net Sales 2,210,000 Credit All sales are made on credit. Based on past experience, the company estimates 2.0% of ending accounts receivable to be uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?
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