Question

The following information is from the 2015 records of Armand Camera Shop: Accounts Receivable, December 31, 2015 $40,000 (debit) Allowance for Doubtful Accounts, December 31, 2015 prior to adjustment 1,500 (debit) Net credit sales for 2015 175,000 Accounts written off as uncollectible during 2015 15,000 Cash sales during 2015 27,000 Bad debts expense is estimated by the percent-of-sales method. The management estimates that 3% of net credit sales will be uncollectible. Calculate the amount of bad debts expense for 2015 and prepare the Journal Entry.

Answer 1

Answer:

$5,250

Explanation:

The computation of the bad debt expense for year 2015 is shown below:

= Net Credit sales × uncollectible percentage given

= $175,0000 × 3%

= $5,250

Under the percent-of-sales method, simply we multiplied the net credit sales by the uncollectible percentage given so that the bad debt expense could have come. All other information given is of no significance. So, ignored it

Answer 2

Answer:

Boxed

Explanation: