Question

The F1 Company has provided the following information: • Accounts receivable written-off as uncollectible during the year amounted to $11,500. • The accounts receivable balance at the beginning of the year was $150,000. • The accounts receivable balance at the end of the year was $210,000. • The allowance for doubtful accounts balance at the beginning of the year was $14,000. • The allowance for doubtful accounts balance at the end of the year after the recording of bad debt expense was $12,900. • Credit sales during the year totaled $900,000. How much was F1 Company's bad debt expense?

Answer 1

The amount of bad debt expenses of F1 Company is $18,500.

Here, we will calculate the amount of bad debt expenses from the information given in the question.

Particulars                                                                      Amount

Accounts receivable written-off as uncollectible       $11,500

Add: Closing doubtful debts                                       $21,000

Less: Opening doubtful debts                                   ($14,000)

Bad debt expense                                                        $18,500

Therefore, the amount of bad debt expenses of F1 Company is $18,500.

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