Kennedy Company uses the balance sheet approach in estimating uncollectible acco

Question

Kennedy Company uses the balance sheet approach in estimating uncollectible accounts expense. The company prepares an adjusting entry to recognize the expense at the end of each month. During the month of July, the company wrote-off a $4,000 receivable and made no recoveries of previous write-offs. Following the adjusting entry for July, the credit balance in the Allowance for Doubtful Accounts was $3,800 larger than it was on July 1. What amount of uncollectible expense was recorded on July? $2,950 $1,050 $1,900 $7,800

Explanation / Answer

Kennedy Company All Amounts in $ The amount of uncollectible account expense for July Write-off of receivable 4000 Add : Increase in Credit Balance of Allowance for Doubtful Debts 3800 Total 7800

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