On January 1, Year 2, Grande Company had a $16,000 balance in the Accounts Receivable account and a zero balance in the Allowance for Doubtful Accounts account. During Year 2, Grande provided $104,000 of service on account. The company collected $97,000 cash from accounts receivable. Uncollectible accounts are estimated to be 2% of sales on account. The amount of uncollectible accounts expense recognized on the Year 2 income statement is:
A) $320.
B) $1,000.
C) $2,080.
D) $1,940.

Question

Quizplus · Accepted Answer

$104,000 sales on account × 2% = $2,080 uncollectible accounts expense

On January 1, Year 2, Grande Company Had a $16,000