Lynx Corp.
The data presented below for Lynx Corp.are for the year ended December 31,2017:
?
$$\begin{array} { l r }
\text { Sales (100\% on credit) } & \$ 1,000,000 \
\text { Sales returns } & 30,000 \
\text { Accounts receivable (December 31,2017) } & 170,000 \
\text { Allowance for doubtful accounts (credit balance) } & \
\quad \text { (before adjustment at December } 31,2017 ) & 1,300 \
\text { Estimated amount of uncollectible accounts based on aging analysis } & 14,000
\end{array}$$ ?
-See the data for Lynx Corp. If Lynx Corp.estimates its bad debt to be 1% of net credit sales,what will be the balance in Allowance for Doubtful Accounts after the adjustment for bad debts?
A)$1,300
B)$9,700
C)$8,400
D)$11,000

Question

Lynx Corp.
The data presented below for Lynx Corp.are for the year ended December 31,2017:
?
 $$\begin{array} { l r } 
\text { Sales (100\% on credit) } & \$ 1,000,000 \
\text { Sales returns } & 30,000 \
\text { Accounts receivable (December 31,2017) } & 170,000 \
\text { Allowance for doubtful accounts (credit balance) } & \
\quad \text { (before adjustment at December } 31,2017 ) & 1,300 \
\text { Estimated amount of uncollectible accounts based on aging analysis } & 14,000
\end{array}$$ ?
-See the data for Lynx Corp. If Lynx Corp.estimates its bad debt to be 1% of net credit sales,what will be the balance in Allowance for Doubtful Accounts after the adjustment for bad debts?
A)$1,300
B)$9,700
C)$8,400
D)$11,000

Quizplus · Accepted Answer

The net credit sales are $970,000 ($1,000,000 - $30,000). 1% of $970,000 is $9,700. The existing allowance is $1,300, so the adjusted balance will be $1,300 + $9,700 = $11,000.

Lynx Corp the Data Presented Below for Lynx Corp ? -See the Data for Lynx Corp

Lynx Corp
the Data Presented Below for Lynx Corp ?
-See the Data for Lynx Corp