Question

In 2014 the Golic Co. had net credit sales of $600,000. On January 1, 2014, the Allowance for Doubtful Accounts had a credit balance of $15,000. During 2014, $24,000 of uncollectible accounts receivable were written off. Past experience indicates that the allowance should be 10% of the balance in receivables (percentage-of-receivables basis). If the accounts receivable balance at December 31 was $160,000 what is the required adjustment to the Allowance for Doubtful Accounts at December 31, 2014?

Answer 1

Answer:

what is the required adjustment to the Allowance for Doubtful Accounts at December 31, 2014?

Expense doubtful  16000  

Allowance Doubtful   16000  

Explanation:

Credit Sales 600000    

Doubtful 15000    

Writte Off 24000    

AR 160000    

   

Doubtful Accounts Jan-1 15000  

Uncollective account  15000 9000 24000

 0  

AR            160000    

            10%    

Doubtful       16000    

   

Expense doubtful  16000  

Allowance Doubtful   16000