last ones please help PRINTER VERSION nAco NEXT Brief Exercise 9-6 Farr Co. olec

Question

last ones please help

PRINTER VERSION nAco NEXT Brief Exercise 9-6 Farr Co. olects to use the percentage-of-sales basis in 2017 to record bad debt expense. It estimates that 4% of net credit sales will become uncollectible. Sales revenues are $847,000 for 2012, sales returns and allowances are $48,400, and the allowance for doubtful accounts has a credit balance of $9,600. Prepare the adjusting entry to record bad debt expense in 2017, (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Tities and Explanation Debit Credit LINK TO TEXT Question Attempts: 0 of 5 used SUBMIT ANSWE SAVE FOR LATER

Explanation / Answer

Calculation of Bad Debts Expense for 2017:

Sales Revenue

$        847,000

Less: Sales Returns and Allowances

$        (48,400)

Net Sales

$        798,600

Estimated Uncollectible sales = Net Sales * 4% = 798600 * 4% =

$          31,944

Less: Credit Balance in Allowance for doubtful accounts =

$            9,600

Bad Debts Expense = 31944 - 9600 =

$          22,344

Adjusting entry to record bad debts expenses in 2017:

Account titles and Explanation

Debit

Credit

Bad Debt Expenses

$          22,344

Allowance for doubtful accounts

$ 22,344

(being provision made for doubtful debts)

Calculation of Bad Debts Expense for 2017:

Sales Revenue

$        847,000

Less: Sales Returns and Allowances

$        (48,400)

Net Sales

$        798,600

Estimated Uncollectible sales = Net Sales * 4% = 798600 * 4% =

$          31,944

Less: Credit Balance in Allowance for doubtful accounts =

$            9,600

Bad Debts Expense = 31944 - 9600 =

$          22,344

Adjusting entry to record bad debts expenses in 2017:

Account titles and Explanation

Debit

Credit

Bad Debt Expenses

$          22,344

Allowance for doubtful accounts

$ 22,344

(being provision made for doubtful debts)

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