Data for the year ended December 31 are presented below.Sales (100% on credit)

-Refer to A&B Foods. If the company uses the aging of accounts receivable method to estimate its bad debts, what will be the net realizable value of its accounts receivable after the adjustment for bad debt expense?

Question

Data for the year ended December 31 are presented below.Sales (100% on credit)
 
-Refer to A&B Foods. If the company uses the aging of accounts receivable method to estimate its bad debts, what will be the net realizable value of its accounts receivable after the adjustment for bad debt expense?

Quizplus · Accepted Answer

Using the aging of accounts receivable method, we estimate the allowance for doubtful accounts to be $18,000 ($17,000 + $1,000). Therefore, the net realizable value of accounts receivable would be $345,000 ($363,000 - $18,000).

Data for the Year Ended December 31 Are Presented Below