Exercise 9-6 Percent of accounts receivable method LO P3 At each calendar year-e

Question

Exercise 9-6 Percent of accounts receivable method LO P3 At each calendar year-end, Mazie Supply Co uses the percent of accounts receivable method to estimate bad debts. On December e of $84,500, and it estimates that 3% will be uncollectible Prepare the adjusting entry to record bad debts expense for year 2017 under the assumption that the Allowance for Doubtful Accounts has: (a) a $1,437 credit balance before the adjustment (b) a $423 debit balance before the adjustment View transaction list Journal entry worksheet Prepare the adjusting entry to record bad debts expense for year 2017 under the assumption that the Allowance for Doubtful Accounts has a $1,437 credit balance before the adjustment. Note: Enter debits before credits. Debit ia) coed y Clear entry View general journal

Explanation / Answer

Estimated bad debts = 84500*3% 2535 TR General journal Debit Credit 1) Bad debts expense 1098 Allowance for Doubtful accounts 1098 (2535-1437) 2) Bad debts expense 2958 Allowance for Doubtful accounts 2,958 (2535+423)

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