Answer:
The adjusting entries are shown below:
Explanation:
The journal entries are shown below:
a. Bad debt expense $85,230
To Allowance for doubtful debts $85,230
(Being the bad debt expense is recorded)
The computation is shown below:
= $5,682,000 × 1.5%
= $85,230
a. Bad debt expense $75,870
To Allowance for doubtful debts $75,870
(Being the bad debt expense is recorded)
The computation is shown below:
= ($5,682,000 + $5,682,000) × 1%
= $75,870
