The ledger of Salizar Company at the end of the current year shows Accounts Receivable $110,000, Sales $840,000, and Sales Returns and Allowances $40,000.
(a) If Allowance for Doubtful Accounts has a credit balance of $2,500 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 1% of net sales, and (2) 10% of accounts receivable.
(b) If Allowance for Doubtful Accounts has a debit balance of $500 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 0.75% of net sales and (2) 6% of accounts receivable.© BrainMass Inc. brainmass.com March 21, 2019, 12:55 pm ad1c9bdddf
In the books of Salizar Company Journal entries
DATE PARTICULARS DEBIT CREDIT
a.1 Bad debt expense(1% of 840000) 8400
Allowance for doubtful ...
Solution contains journal entries to record allowance for doubtful debts.