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Session%2010 - Solutions For Session 10 Assignments...

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Solutions For Session 10 Assignments: Multiple Choice (Page 361): 1 . b 2. c 3. c 4. b 5. c 6. d 7. a 8. d 9. c 10. a E7-1A If bad debt expense is 3% of credit sales, how much bad debt expense will be on the year-end income statement? Credit sales $800,000 Percent estimated uncollectible 3% Current year bad debt expense $24,000 E7-3A a. What is the journal entry needed to record bad debts expense? Debit Credit Bad debts expense 930 Allowance for doubtful accounts 930 To record current period's bad debts expense. Calculation of bad debt expense: Ending balance in accounts receivable $20,600 Percent estimated uncollectible 5% Desired balance in Allowance account 1,030 Allowance balance prior to adjustment (100 )
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Current period bad debts expense $930 b. What amount will be shown on the year-end income statement for bad debts expense? The current period's bad debt expense is $930. c. What is the balance in the Allowance account after all adjustments have been made?
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