Chapter 6, Problem 6.6E

Reporting Bad Debt Expense and Accounts Receivable

At the end of the prior year, Durney’s Outdoor Outfitters reported the following information.

Accounts Receivable. Dec. 31 prior year
Accounts Receivable (Gross) (A)	$48,067
Allowance for Doubtful Accounts (X A)	8,384
Accounts Receivable (Net) (A)	$39,683

During the current war. sales on account were $304.423, collections on account were $289,850. write offs of bad debts were $6.969, and the bad debt expense adjustment was $4.685.

Required:

Show hew the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year. (Hint: Complete the Accounts Receivable and Allowance for Doubtful Accounts T-accounts to determine the balance sheet values.) Disregard income tax considerations.