Answer:
accounts receivable = $276,000
total credit sales = $1,000,000
3% of accounts receivable will not be decollete = $276,000 x 3% = $8,280
if allowance for doubtful accounts has a credit balance of $2,200, you must add = $8,280 - $2,200 = $6,080
the adjusting entry should be:
Dr Bad debt expense 6,080
Cr Allowance for doubtful accounts 6,080
Since allowance for doubtful accounts is a contra asset account it has a credit balance that reduces the value of accounts receivable.
