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An aging of a company’s accounts receivable indicates that
$10,000 are estimated to be uncollectible. If Allowance for
Doubtful Accounts has a $1,100 credit balance, the adjustment to
record bad debts for the period will require a
debit to Bad Debts Expense for $8,900.
credit to Allowance for Doubtful Accounts for $10,000.
debit to Bad Debts Expense for $10,000.
debit to Allowance for Doubtful Accounts for $8,900.
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Multiple Choice Question 71
A reasonable amount of uncollectible accounts is evidence
that the credit policy is too strict.
of poor judgments on the part of the credit manager.
that the credit policy is too lenient.
of a sound credit policy.
10-
Multiple Choice Question 105
Kill Corporation’s unadjusted trial balance includes the following
balances (assume normal balances):
Accounts Receivable $ 750,000
Allowance for Doubtful Accounts 15,000
Bad debts are estimated to be 6% of outstanding receivables.
What amount of bad debts expense will the company record?
$15,000