Question

Rue Co.’s allowance for uncollectible accounts had a credit balance of $12,000 at December 31, Year 1. During Year 2, Rue wrote off uncollectible accounts of $48,000. The aging of accounts receivable indicated that a $50,000 allowance for uncollectible accounts was required at December 31, Year 2. What amount of uncollectible accounts expense should Rue report for Year 2?A. $50,000B. $86,000C. $60,000D. $48,000

Answer 1

Answer:

option B

Step-by-step explanation:

given,

allowance for uncollectible accounts had a credit balance = $12,000.

Rue wrote off uncollectible accounts =  $48,000

The aging of accounts receivable indicated = $50,000

amount of uncollectible accounts expense = ?

credit balance - wrote off uncollectible account + account expense = account                                                                                                 recievable

$12,000 - $48,000 + account expense = $50,000

account expense = $50,000 + $ 36,000

account expense = $86,000

amount of uncollectible accounts expense =  $86,000

Hence, the correct answer is option B