The following information is taken from the records of Salzl Corp. at its December 31 year-end:
2019 2020
Accounts written off
During 2019 $2,400
During 2020 $1,000
Recovery of accounts written off
Recovered in 2020 300
Allowance for doubtful accounts
(adjusted balance)
At December 31, 2018 8,000
At December 31, 2019 9,000
Salzl had always estimated its uncollectible accounts at two per cent of sales. However, because of large discrepancies between the estimated and actual amounts, Hilroy decided to estimate its December 31, 2019 uncollectible accounts by preparing an ageing of its accounts receivable. An amount of $10,000 was considered uncollectible at December 31, 2020.
Required:
1. Calculate the amount of bad debt expense for 2019.
2. Calculate the amount of bad debt expense for 2020.
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