Your answer is partially correct. Try again. current year shows Accounts Recelva

ID: 2539739 • Letter: Y

Question

Your answer is partially correct. Try again. current year shows Accounts Recelvable $85,700; Credit Sales $845,580; and Sales Returns and Allowances $42,390. a) If Marlgold uses the direct write-off method to account for uncollectible accounts and Marigold determines that Matisse's $883 balance is uncolectible, what will Marigold record as bad debt Bad debt expense (b) , Alo a ce for Do e t A r ut, han balance of S1 191 and Marigold co dudes bad debts are expected to be 9% of accounts receivable, what will Marigold record as bad debt exper Bad debt expense

Explanation / Answer

Bad debts expenses to be recognised = Bad debts expected - balance in allowance for bad debts

Accounts receivables (A)

$85,700

Bad debts 9% of accounts receivables (B=A*9%)

$7,713

Less: Balance in allowance for doubtful debts (C)

$1,191

Total bad debts expenses to be recognised (D=B-C)

$6,522

Ans) Bad debts expenses = $6,522