At each calendar year-end, Mazie Supply Co. uses the percent of accounts receiva

Question

At each calendar year-end, Mazie Supply Co. uses the percent of accounts receivable method to estimate bad debts. On December 31, 2017, it has outstanding accounts receivable of $104,500, and it estimates that 6% 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 $1,777 credit balance before the adjustment (b) a $523 debit balance before the adjustment View transaction list Prepare the adjusting entry to record bad debts expense for year 2017 under the assumption that the Allowance for Doubtful Accounts has a $1,777 credit balance before the adjustment. 1 7 under 7 credit Prepare the adjusting entry to record bad debts expense for year 2017 under the assumption that the Allowance for Doubtful Accounts has a $523 debit balance before the adjustment. 2 Credit

Explanation / Answer

1 Bad debts expense 4493 =(104500*6%)-1777          Allowance for doubtful accounts 4493 2 Bad debts expense 6793 =(104500*6%)+523          Allowance for doubtful accounts 6793

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