omework 8 Question 1 (of 10) value 8.00 points Assume Simple Co. had credit sale

Question

omework 8 Question 1 (of 10) value 8.00 points Assume Simple Co. had credit sales of $248,000 and cost of goods sold of $148,000 for the period. Simple uses the percentage of credit sales method and estimates that 1 percent of credit sales would result in uncollectible accounts. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $230. What amount of Bad Debt Expense would the compa ny record as an end-of-period adjustment? Debt Expense References eBook & Resources Difficulty: 1 Easy Learning Objective accounts : 0 F3 F1 F4 03 F7 F5 F6 2

Explanation / Answer

Bad debts expense $ 2,480 Explanation: Credit sales revenue: $248,000 Estimated % of credit sales as bad debts 1% of credit sales Bad debts expense: 248,000*1% = $2,480

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