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Incorrect answer iconYour answer is incorrect. The following information is related to December 31, 2021 balances....

Incorrect answer iconYour answer is incorrect.

The following information is related to December 31, 2021 balances.

•

Accounts receivable

$3020000

•

Allowance for doubtful accounts (credit)

(293000)

•

Cash realizable value

$2880000


During 2022 sales on account were $852000 and collections on account were $510000. The company wrote off $46000 in uncollectible accounts. An analysis of outstanding receivable accounts at year end indicated that bad debts should be estimated at $390000. Bad debt expense for 2022 is

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Answer #1

Allowance for doubtful accounts, beginning = $293,000

Accounts receivable written off = $46,000

Allowance for doubtful accounts, ending = $390,000

Bad debt expense = Allowance for doubtful accounts, ending - (Allowance for doubtful accounts, beginning - Accounts receivable written off )

= 390,000-(293,000-46,000)

= 390,000-247,000

= $143,000

Bad debt expense for 2022 is = $143,000

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