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Journal entry for Allowance for bad debts

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Battle Tank, Inc. had net sales in 2004 of $1,200,000. At December 31, 2004, before

adjusting entries, the balances in selected accounts were: Accounts Receivable $250,000

debit, and Allowance for Doubtful Accounts $2,100 credit. If Battle Tank estimates that

2% of its net sales will prove to be uncollectible, prepare the December 31, 2004, journal

entry to record bad debt expense.

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Solution Summary

The solution explains the journal entry to record bad debt expense.

Solution Preview

The amount of uncollectible expense is 2% of net sales = 1,200,000 X 2% = ...

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