The CHS Company has provided the following information: • Accounts receivable written-off as uncollectible during the year amounted to $11,500.
• The accounts receivable balance at the beginning of the year was $150,000.
• The accounts receivable balance at the end of the year was $210,000.
• The allowance for doubtful accounts balance at the beginning of the year was $14,000.
• The allowance for doubtful accounts balance at the end of the year after the recording of bad debt expense was $12,900.
• Credit sales during the year totaled $900,000.
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How much was CHS Company's bad debt expense?
A)$11,500.
B)$12,900.
C)$10,400.
D)$14,000.

Question

Quizplus · Accepted Answer

To calculate bad debt expense, we need to use the allowance method:
Beginning balance in allowance for doubtful accounts + Bad debt expense - Write-offs = Ending balance in allowance for doubtful accounts
$14,000 + Bad debt expense - $11,500 = $12,900
Solving for Bad debt expense, we get
Bad debt expense = $10,400. Therefore, the answer is C.

The CHS Company Has Provided the Following Information: • Accounts