Answer:
See below.
Explanation:
According to the data, current income before tax is as follows,
Income before tax = (10,500-6250-1300-325) = $2,625
So last year the Income after tax would be = (2625 - (2625*0.35) = $1,706.25
This year the depreciation rises by 1,250 so the total change in net income is as follows,
Income before tax for this year = 2625-1240 = $1385
After tax income = 1385 - (1385*0.35) = $900.25
So the total change in net income over the two years
= 1706.25 - 900.25 = Fall by $806
Hope that helps.
Answer:
Dr. Bad Debt Expense $5,470
Cr. Allowance for uncollectible accounts $5,470
Explanation:
The Allowance method requires to recognize the estimated bad debt expense int he period of sale. For this purpose an adjusting entry is made using an estimed percentage value of sales as uncollectible accounts.
Allownace for Uncollectible accounts = $547,000 x 1% = $5,470