On January 1,Davidson Services has the following balances:
Accounts Receivable $21,000
Bad Debts Expense $0
Davidson has the following transactions during January: Credit sales of $150,000,collections of credit sales of $83,000,and write-offs of $20,000.Davidson uses the direct write-off method.The amount of Bad Debts Expense for January is ________.
A)$21,000
B)$36,145
C)$11,067
D)$20,000

Question

Quizplus · Accepted Answer

Under the direct write-off method, bad debts expense is recognized when specific accounts are deemed uncollectible. In January, Davidson wrote off $20,000, so the bad debts expense is $20,000.

On January 1,Davidson Services Has the Following Balances