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19 September, 04:12

Accounts Receivable, December 31, 2017 $ 20,000 (debit) Allowance for Bad Debts, December 31, 2017 prior to adjustment 600 (debit) Net credit sales for 2017 93,000 Accounts written off as uncollectible during 2017 500 Bad debts expense is estimated by the aging-of-accounts-receivables method. Management estimates that $ 3,150 of accounts receivable will be uncollectible. Calculate the amount of net accounts receivable after the adjustment for bad debts.

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  1. 19 September, 04:24
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    AR 20,000

    Allowance 3,750

    Net AR 16,250

    Explanation:

    AR 20,000

    allowance 600 debit (before adjustment)

    management estimated that 3,150 of Ar will be uncollectible.

    we must adjust allowance to reach this value:

    expected 3,150

    current 600 debit

    adjustment 3,750

    AR 20,000

    Allowance 3,750

    Net AR 16,250
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