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How to determine the bad debt expense

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Reference no: EM132586716

ABC Co's unadjusted trial balance at December 31,2017, included the following accounts:

Accounts receivable P1,000,000

Allowance for doubtful accounts 40,000

Sales P15,000,000

Sales returns and allowances 700,000

Question 1: ABC Company estimates its bad debts expense to be 1 1/2 % of net sales. Determine its bad debt expense for 2017.

Option 1: P55,000

Option 2: P214,500

Option 3: P225,000

Option 4: Answer not given

Option 5: P254,500

Reference no: EM132586716

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