Chapter 9, Problem 5E

To determine

Percent of Receivable Method:

Percent of receivable method is one of the method of computing the estimated bad debt expense during an accounting period. Bad debt expense under percent of receivable method is estimated based of certain percentage of ending accounts receivable of the business.

To determine:

Prepare adjusting entry to record bad debt expense for year 2017 under the two assumed balance of Allowance for Doubtful Accounts.