Journal entry to record the estimate for bad debts

Reference no: EM13818719

On dec 31, of the current year, a company's unadjusted trial balance revealed the following: accounts receivable of $185600; Sales Revenue of 128000; (75% were on credit); and allowance for doubtful accounts of 1600 (credit balance).

Prepare the following journal entry to record the estimate for bad debts assuming:

1. 6% of the accounts receivable balance is assumed to be uncollectible.

2. Bad debts expense is estimated to be 1.55 of credit sales.

Reference no: EM13818719

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