Problemassume simple co had credit sales of 240000 and cost, Ask an Expert

Accounting

Problem:

Assume Simple Co. had credit sales of $240,000 and cost of goods sold of $140,000 for the period. Simple uses the percentage of credit sales method and estimates that 1 percent of credit sales would result in uncollectible accounts. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $150.

Required:

Question: What amount of Bad Debt Expense would the company record as an end-of-period adjustment?

Note: Please provide through step by step calculations.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91164724

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