Assume that Simple Co had credit sales of 240000 and cost of

Assume that Simple Co. had credit sales of $240,000 and cost of goods sold of $140,000 for the period Simple uses the aging method and estimates that the appropriate ending balance in the Allowance for Doubtful Accounts is $2.000. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $150 What amount of Bad Debt Expense would the company reoord as an end-of-period adjustment? Type here to search F1 F2 F3 F4 F5 F6 k4 F7

Solution

Answer :- $1,850

Explanation :-

Given ending balance in Allowance for doubtful accounts = $2000

Credit balance in allowance for doubtful accounts = $150

Therefore Adjustment in allowance for doubtful account = 2000-150= 1850

This implies bad debt expense company will record is $1,850