Using the aging-of-accounts-receivable method to estimate uncollectible receivables,CMU Corporation estimates that $3,750 of its accounts receivable will be uncollectible.Prior to adjustment,the Allowance for Uncollectible Accounts has a credit balance of $600.Bad debt expense to be reported on the income statement is:

Question

Quizplus · Accepted Answer

To calculate the bad debt expense, we need to subtract the current balance of the allowance for uncollectible accounts from the estimated uncollectible receivables.

Estimated uncollectible receivables = $3,750 
Allowance for Uncollectible Accounts = $600 credit balance

Therefore, bad debt expense = $3,750 - $600 = $3,150.

Therefore, the correct answer is C.

Using the Aging-Of-Accounts-Receivable Method to Estimate Uncollectible Receivables,CMU Corporation Estimates