At the end of the current year, the trial balance of Carlton's Auto Sales included the accounts and balances shown below. Credit sales were $9,200,000. Returns and allowances on these sales were $55,000. Assume that the firm bases its estimate of the loss from uncollectible accounts on 0.3 percent of net credit sales.
Accounts Receivable $ 1,300,000 Dr.
Allowance for Doubtful Accounts 9,000 Cr.
Sales 14,000,000 Cr.
Sales Returns and Allowances 110,000 Dr.
1. What is the estimated loss from uncollectible accounts for the current year?
2. What is the balance in the Allowance for Doubtful Accounts after adjustment?

Question

At the end of the current year, the trial balance of Carlton's Auto Sales included the accounts and balances shown below. Credit sales were $9,200,000. Returns and allowances on these sales were $55,000. Assume that the firm bases its estimate of the loss from uncollectible accounts on 0.3 percent of net credit sales.
Accounts Receivable $ 1,300,000 Dr. 
Allowance for Doubtful Accounts 9,000 Cr.
Sales 14,000,000 Cr.
Sales Returns and Allowances 110,000 Dr.
1. What is the estimated loss from uncollectible accounts for the current year?
2. What is the balance in the Allowance for Doubtful Accounts after adjustment?

Quizplus · Accepted Answer

The Answer of At the end of the current year, the trial balance of Carlton's Auto Sales included the accounts and balances shown below. Credit sales were $9,200,000. Returns and allowances on these sales were $55,000. Assume that the firm bases its estimate of the loss from uncollectible accounts on 0.3 percent of net credit sales.
Accounts Receivable $ 1,300,000 Dr. 
Allowance for Doubtful Accounts 9,000 Cr.
Sales 14,000,000 Cr.
Sales Returns and Allowances 110,000 Dr.
1. What is the estimated loss from uncollectible accounts for the current year?
2. What is the balance in the Allowance for Doubtful Accounts after adjustment?

At the End of the Current Year, the Trial Balance