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Maple Co. provides for bad debts expense at the rate of 5.64% of ending Accounts Receivable....

Maple Co. provides for bad debts expense at the rate of 5.64% of ending Accounts Receivable. On Jan 1, 20X1, the Allowance for Bad Debts was $9,000. There were $16,000 of accounts written off during the year. Credit sales for the year were $775,000. Ending Accounts Receivable was $120,000. What is the amount of Bad Debt Expense for the year?

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Answer #1

Bad debts expense = $13,768

Working

Estimated balance of allowance for uncollectables $    6,768.00 Cr
Balance in Allowance for bad debts Unadjusted (Dr) $    7,000.00 Dr
Total bad debts to be recorded $ 13,768.00 Cr

.

Beginning balance of Allowance for Bad Debts account $      9,000.00 Cr
Less: Amount written off $ (16,000.00) Dr
Unadjusted balance for allowance for bad debts $    (7,000.00) Dr
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