The 2009 annual report for Sears Holding Corporation contained the following inf
ID: 2434917 • Letter: T
Question
The 2009 annual report for Sears Holding Corporation contained the following information (in millions):2009 2008
Accounts receivable $881 $781
Allowance for doubtful accounts 42 37
equals:
Accounts receivable, net $839 $744
A footnote to the financial statements disclosed that accounts receivable write-offs amounted to $13 during 2009 and $3 during 2008. Assume that Sears did not record any recoveries.
Problem: Determine the Bad Debt Expense for 2009 based on the above facts. (answer in millions.)
Explanation / Answer
Allowance for doubtful accounts Beginning Balance $37 Less: Write off during the year $13 Total Available $24 Ending Balance $42 Bad debts Expense $18 ===
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