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A company has net credit sales of $900,000 for the year and it estimates that uncollectible accounts will be 2% of net credit sales. If Allowance for Doubtful Accounts has a credit balance of $1,000 prior to adjustment.
Instructions:
Based on the above given information answer the following questions:
Question 1) What is the amount of bad debt expense the must be presented on the company's income statement?
Question 2) What is the accounts receivable net realizable value, is the accounts receivable balance is equal to $1,000,000?
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