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that the credit policy is too lenient.
of a sound credit policy.
10Multiple 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
$44,100
$30,000
$45,000
11Multiple Choice Question 97
Using the percentage-of-receivables basis, the uncollectible accounts
for the year is estimated to be $31,000. If the balance for the
Allowance for Doubtful Accounts is a $7,000 debit before adjustment,
what is the amount of bad debts expense for the period?
$31,000
$38,000