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6 February, 10:08

GCM Corporation had a 1/1/14 balance in the Allowance for Doubtful Accounts of $25,000. During 2014, it wrote off $18,000 of accounts and collected $5,250 on accounts previously written off. The balance in Accounts Receivable was $500,000 at 1/1 and $600,000 at 12/31. At 12/31/14, GCM estimates that 5% of accounts receivable will prove to be uncollectible. What should GCM report as its Allowance for Doubtful Accounts at 12/31/14? a. $12,000. b. $12,250. c. $17,250. d. $30,000.

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  1. 6 February, 12:59
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    What should GCM report as its Allowance for Doubtful Accounts at 12/31/14?.

    d. $30,000.

    Explanation:

    1/01/2014 Allowance 25000

    Wrotte off - 18000

    Account previously 5250

    12250

    1/01/2014 Account receivable 500000

    31/12/2014 Account receivable 600000

    %Uncollectible 5%

    30000
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