mheducation t htm Help Save& Exit Subn On January 1, Year 2, Kincaid Company\'s

Question

mheducation t htm Help Save& Exit Subn On January 1, Year 2, Kincaid Company's Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $64,800 and $1,600, respectively During the year Kincaid reported $159,000 of credit sales. Kincaid wrote off $1,300 of receivables as uncollectible in Year 2 Cash collections of receivables amounted to $173,500 Kincaid estimates that it will be unable to collect one percent (1%) of credit sales. o4 Kincaid's entry required to recognize the uncollectible accounts expense for Year 2 will: Multiple Choice decreese total essers and net income increase total assets end decresse net income

Explanation / Answer

The answer is part a i.e The uncollectable accounts expense will decrease total assets and net income

The entity estimates that 1590(159000*1%) is uncollecatable, so it will debit bad debts expense & credit allowance for doubtful debts.

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