Question

The following information is available for Tugboat Company: Allowance for doubtful accounts, January 1, 2020: $7,000...

The following information is available for Tugboat Company:

Allowance for doubtful accounts, January 1, 2020: $7,000 CR

Credit sales during 2020: $270,000

Accounts receivable written off in 2020: $2,800

After reviewing the aging of Accounts Receivable, management has determined that the ending balance in the Allowance for Doubtful Accounts should be $7,500. What amount should Tugboat record as bad debt expense for 2020?

Question 7 options:

$3,300

$4,200

$7,400

$7,500
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