The balance of the Allowance for Doubtful Accounts account at January1 of the current year was $6,800. During the year, accounts receivable in the amount of $9,000 were written off. Estimated uncollectible accounts expense using the percentage-of-sales basis for the year amounts to $7,200. The balance of the Allowance for Doubtful Accounts account to be reported on the balance sheet at year-end is

(A) $7,200.

(B) $5,000.

(C) $14,000.

(D) $8,600.

Question

Business

Mcpherson

11 April, 03:09

The balance of the Allowance for Doubtful Accounts account at January1 of the current year was $6,800. During the year, accounts receivable in the amount of $9,000 were written off. Estimated uncollectible accounts expense using the percentage-of-sales basis for the year amounts to $7,200. The balance of the Allowance for Doubtful Accounts account to be reported on the balance sheet at year-end is

(A) $7,200.

(B) $5,000.

(C) $14,000.

(D) $8,600.

+5

Answers (1)

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Madison Lambert · Answer 1

Given:

Accounts receivable = $9,000

Allowance for Doubtful Accounts (current year) = $6,800

Estimated uncollected accounts expense = $7,200

The balance of the Allowance for Doubtful Accounts to be reported on the balance sheet at year-end can be computed as:

Allowance for Doubtful Accounts (at year end) = Allowance for Doubtful Accounts (current year) + Estimated uncollected accounts expense - Accounts receivable

Allowance for Doubtful Accounts (at year end) = $6,800 + $7,200 - $9,000

Allowance for Doubtful Accounts (at year end) = $5,000

∴ The balance of the Allowance for Doubtful Accounts to be reported on the balance sheet at year-end is $5,000.