Prepare an adjusting journal entry to record the bad debt

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Robert has credit sales of $1 200 000 during 2020 and estimates at the end of 2020 that 1% of these credit sales will default. During 2020 a customer defaults on a $6000 balance related to goods purchased during 2019. Robert's accounts receivable balance was $50 000 and allowance for bad debts balance was $7000 (credit). The financial year ends on 31 December.

Required

Question I. Prepare an adjusting journal entry to record the bad debt expense for 2020.

Question II. What is the net accounts receivable balance at the end of the year?

Reference no: EM132506036

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