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arlik [135]
3 years ago
12

The Allowance for Bad Debts has a credit balance of $ 7 comma 500 before the adjusting entry for bad debts expense. After analyz

ing the accounts in the accounts receivable subsidiary ledger using the agingminusofminus receivables​ method, the​ company's management estimates that uncollectible accounts will be $ 14 comma 000. What will be the amount of Bad Debts Expense reported on the income​ statement?
Business
1 answer:
Olenka [21]3 years ago
5 0

Answer:

The amount of bad debt exp is 7000

Explanation:

Allowance for bad debt exp has a credit balance of 7500 before adjusting entry

Now the management wants to estimate the uncollectible accounts at 14500

So we have to increase the balance of the allowance account from 7500 to 14500

Like 14500-7500=7000

So we need to record the entry by 7000 to increase the amount of the allowance to 14500

The entry

Bad debt exp Dr. 7000

Allowance for doubtful accounts Cr 7000

Now the bad debt exp will be reported in the income statement by 7000

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Answer:

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Explanation:

A fix Payment for a specified period of time is called annuity. The discounting of these payment on a specified rate is known as present value of annuity.

Formula for Present value of annuity is as follow

PV of annuity = P x [ ( 1- ( 1+ r )^-n ) / r ]

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<h2>Evaluative Feedback Increases.</h2>

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The bookkeeper for Mustang Company forgot to make the end-of-the-period adjustment for the interest expense that had accrued dur
yawa3891 [41]

Answer:

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