4. 2.50 points MB-8 Estimating Bad Debts Using the Aging Method [LO 8-2] Assume

Question

4. 2.50 points MB-8 Estimating Bad Debts Using the Aging Method [LO 8-2] Assume that Simple Co. had credit sales of $253,000 and cost of goods sold of $153,000 for the period Simple uses the aging method and estimates that the appropriate ending balance in the Allowance for Doubtful Accounts is $3,300. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $280. What amount of Bad Debt Expense would the company record as an end-of-period adjustment? References Worksheet

Explanation / Answer

Estimated ending balance in allowance for doubtful debts =3300

credit balance in allowance for doubtful debts = 280

bad debts at year end after adjsutment = 3300-280 = 3020

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