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Arizona Company: accounts receivable balance, allowance account, bad debt expense

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Arizona Company reported accounts receivable of $21,200,000 at the end of its 2009 fiscal year. This amount was net of an allowance for doubtful accounts of $1,456,000. During 2010, Georgia sold $72,300,400 of merchandise on credit. It collected $48,520,555 from customers. Accounts valued at $2,125,000 were written off as uncollectible during 2010. Arizona's management estimates that 8% of the year-end accounts receivable balance will be uncollectible.

What amount will Arizona report for accounts receivable? Show your computations to earn credit.

What is the balance for the allowance for doubtful accounts at the end of 2010? (round to whole numbers). Show computations to earn credit.

What is the doubtful accounts expense for 2010? Show computations to earn credit.

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This solution goes through financial concepts such as accounts receivable balance, allowance account and bad debt expense.

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