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Vikentia [17]
3 years ago
10

The Allowance for Bad Debts account has a credit balance of $ 3 comma 000$3,000 before the adjusting entry for bad debts expense

. The​ company's management estimates that 44​% of net credit sales will be uncollectible for the year 2019. Net credit sales for the year amounted to $ 290 comma 000$290,000. What is the amount of Bad Debts Expense reported on the income statement for​ 2019?
Business
1 answer:
Triss [41]3 years ago
8 0

Answer:

The bad debt expense which should be recorded in the income statement for the year 2019, amounts to $127,600

Explanation:

The bad debt expense which should be recorded in the income statement for the year 2019 is computed as:

= Net Credit Sales × Uncollectible credit sales for the year 2019

where

Net Credit Sales is $290,000

Uncollectible credit sales for the year 2019 is 44%

Putting the values in the above formula:

= $290,000 × 44%

= $127,600

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Answer: Gross pay- $1750.00

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$1750* 6.0%= $105

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8 0
3 years ago
Preferred stock is a hybrid security because it has some characteristics typical of debt and others typical of equity. The follo
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Answer:

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8 0
2 years ago
Straight Industries purchased a large piece of equipment from Curvy Company on January 1, 2019. Straight Industries signed a not
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Answer:

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