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Business, 25.04.2020 03:31 67555savchenko

At the end of the current year, the accounts receivable account has a debit balance of $2,950,000 and sales for the year total $27,400,000.

a. The allowance account before adjustment has a debit balance of $9,500. Bad debt expense is estimated at 3/4 of 1% of sales.

b. The allowance account before adjustment has a debit balance of $9,500. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $188,000.

c. The allowance account before adjustment has a credit balance of $31,400 Bad debt expense is estimated at 1/2 of 1% of sales.

d. The allowance account before adjustment has a credit balance of $31,400. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $175,000.

Required:

Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above.

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