Question

Bramble Corp. had a 1/1/17 balance in the Allowance for Doubtful Accounts of $45500. During 2017, it wrote off $26000 of accounts and collected $8300 on accounts previously written off. The balance in Accounts Receivable was $780000 at 1/1 and $980000 at 12/31. At 12/31/17, Bramble estimates that 6% of accounts receivable will prove to be uncollectible. What should Bramble report as its Allowance for Doubtful Accounts at 12/31/17

Answer 1

Answer:

$58,800

Explanation:

The computation of the ending balance of Allowance for Doubtful Accounts is shown below:

= Ending balance of account receivable × estimated percentage

= $980,000 × 6%

= $58,800

By multiplying the ending balance of account receivable with the estimated percentage we can get the ending balance of Allowance for Doubtful Accounts could arrive