100 points During the curment Year, Bob\'s Ceramics Shop had sales revenue of $1

Question

100 points During the curment Year, Bob's Ceramics Shop had sales revenue of $160.000, of which $58,000 was on credit At the start of the ourrent year, Accounts Allowance for Doubtlul Accounts showed a $1,600 credit balance. Collections of aocounts recelvable during the cument year amounted to $55,000 a. On December 31, an Account Receivable (Toby's Git Shop) ot $1,800 from a prior year was determined to be unoolectible b. On December 31, on the basis of experience, a decision was made to continue the accounting policy of besing estimated bed debt l losses on 2.5 percent of eredit sales for the year 1. Prepare the required jounal entries for the two items on December 31, end of te accounting period. (I no entry le field.) Journal entry worksheet a decision was made to continue On December 31, on the basis of experience, the accounting policy of basing estimated bad debt losses on 2.5 percent of credit sales for the year 31 MacBook Air

Explanation / Answer

Journal entry :

Date accounts & explanation debit credit Dec 31 Allowance for doubtful accounts 1800     Account receivable 1800 (To record amount write off) Dec 31 Bad debt expense (58000*2.5%) 1450     Allowance for doubtful accounts 1450 (To record bad debt expense)

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