Uncollectible accounts receivable uncollectible

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Unformatted text preview: l Accounts Chapter 7-33 36,850 36,850 LO 5 Explain accounting issues related to valuation of accounts receivable. Uncollectible Accounts Receivable -- Example Uncollectible Accounts Receivable Example E7-7 (Recording Bad Debts) Sandel Company reports the following financial information before adjustments. Instructions: Prepare the journal entry to record bad debt expense assuming Sandel Company estimates bad debts at (a) 1% of net sales (% sales approach) and (b) 5% of accounts receivable (% of receivables approach). Chapter 7-34 LO 5 Explain accounting issues related to valuation of accounts receivable. Uncollectible Accounts Receivable Uncollectible Accounts Receivable E7-7 (Recording Bad Debts) Sandel Company reports the following financial information before adjustments. Instructions: Prepare the journal entry assuming Sandel estimates bad debts at (a) 1% of net sales (Easy stuff because we are calculating the amount of the expense.) Bad Debt Expense Allowance for Doubtful Accounts Chapter 7-35 7,500 7,500 ($800,000 – $50,000) x 1% = $7,500 LO 5 Uncollectible Acc...
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