At year-end,the following balances appeared on the ledger of a company prior to adjusting and closing it books. All receivables arose out of sales transactions except the advances to officers.The company's president estimated that 2 percent of outstanding customer receivables would not be collected.The controller believed that three-quarters of one percent of net credit sales would result in bad debts.How much should be debited to bad debt expense if:
(a) The president's estimate prevails? $__________________.
(b) The controller's view is accepted? $__________________.

Question

At year-end,the following balances appeared on the ledger of a company prior to adjusting and closing it books.  All receivables arose out of sales transactions except the advances to officers.The company's president estimated that 2 percent of outstanding customer receivables would not be collected.The controller believed that three-quarters of one percent of net credit sales would result in bad debts.How much should be debited to bad debt expense if:
(a) The president's estimate prevails? $__________________.
(b) The controller's view is accepted? $__________________.

Quizplus · Accepted Answer

The Answer of At year-end,the following balances appeared on the ledger of a company prior to adjusting and closing it books.  All receivables arose out of sales transactions except the advances to officers.The company's president estimated that 2 percent of outstanding customer receivables would not be collected.The controller believed that three-quarters of one percent of net credit sales would result in bad debts.How much should be debited to bad debt expense if:
(a) The president's estimate prevails? $__________________.
(b) The controller's view is accepted? $__________________.

At Year-End,the Following Balances Appeared on the Ledger of a Company