HW#20 Exercise 7-12 Uncollectible accounts; allowance method and direct write-of

Question

HW#20 Exercise 7-12 Uncollectible accounts; allowance method and direct write-off method for unknown [LO7-6) compared; solvin Castle Company provides estimates for its uncollectible accounts. The allowance for uncollectible accounts had a credit balance of $17.930 at the beginning of 2018 and a $23.710 credit balance at the end of 2 had been used to account for uncollectible accounts (bad debt expense equals actual write-offs), the income statement for have included bad debt expense of $18.400 and revenue of $3,500 from the collection of previously wiritten off bad debis 018 (after adjusting entries), if the direct write-off metho the income statement for 2018 wou Required Determine bad debt expense for 2018 according to the allowance method Prev of 4 Next > 3 5 6

Explanation / Answer

Bad debt expense for 2018 will be calculated as follows: Particular Amount Ending balance in the allowance for doubfut accounts $23,710.00 Less: Beginning balance in the allowance for doubful accounts -$17,930.00 Add: Write off during the period $18,400.00 Less: Collection from account previously written off -$3,500.00 Bad debt expense for 2018 $20,680.00

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