Question

A company has $317,000 in credit sales. The company uses the allowance method of determining uncollectible accounts expense. The allowance for doubtful accounts now has an $8,150 debit balance. If the company uses the allowance method based on 6% of credit sales, what will be the amount of the journal entry credited to allowance for uncollectible accounts

Answer 1

Answer: $19020

Explanation:

From the question, we are informed that a company has $317,000 in credit sales and that the company uses the allowance method of determining uncollectible accounts expense.

We are further told that the allowance for doubtful accounts now has an $8,150 debit balance and that the company uses the allowance method based on 6% of credit sales.

Thee amount of the journal entry credited to allowance for uncollectible accounts will be:

=$317000 × 6%

= $317,000 × 0.06

=$19020