Ask Question
11 September, 19:22

On January 1, Year 2, Kincaid Company's Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $69,000 and $2,500, respectively. During the year Kincaid reported $180,000 of credit sales. Kincaid wrote off $1,600 of receivables as uncollectible in Year 2. Cash collections of receivables amounted to $210,100. Kincaid estimates that it will be unable to collect one percent (1%) of credit sales. The amount of uncollectible accounts expense recognized in the Year 2 income statement will be:

+3
Answers (1)
  1. 11 September, 20:55
    0
    bad debt expense 18,000

    Explanation:

    bad debt 1% of credit sales:

    180,000 x 1% = 18,000

    When the adjustment is made base on sales, the current balance in the allowance for doubtful debts is irrelevant.

    So no calculation is needed for those.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “On January 1, Year 2, Kincaid Company's Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $69,000 and $2,500, ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers