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In 20x7 the Golic Co. had net credit sales of $900,000. On January 1, 20x7, the...

In 20x7 the Golic Co. had net credit sales of $900,000. On January 1, 20x7, the Allowance for Doubtful Accounts had a credit balance of $22,500. During 20x7, $36,000 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 $240,000, what is the required adjustment to the Allowance for Doubtful Accounts at December 31, 20x7?

Question 21 options:

$36,000

$24,000

$37,500

$46,500
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