Craigmont uses the allowance method to account for uncollectible accounts. its year-end unadjusted trial balance shows accounts receivable of $154,500, allowance for doubtful accounts of $1,165 (credit) and sales of $1,175,000. if uncollectible accounts are estimated to be 4% of accounts receivable, what is the amount of the bad debts expense adjusting entry?

Respuesta :

154,500×0.04=6,180

Adjusted balance
6,180−1,165=5,015

Journal entry
Bad debt expenses (Dr 5015)
Allowance for doubtful accounts (Cr 5015)