Flyer Company Has Provided the Following Information Prior to Any

question 74

Multiple Choice

Flyer Company has provided the following information prior to any year-end bad debt adjustment: • Cash sales,$150,000
• Credit sales,$450,000
• Selling and administrative expenses,$110,000
• Sales returns and allowances,$30,000
• Gross profit,$490,000
• Accounts receivable,$110,000
• Sales discounts,$14,000
• Allowance for doubtful accounts credit balance,$1,200
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Flyer estimates bad debt expense assuming that 1.5% of credit sales have historically been uncollectible.What is the balance in the allowance for doubtful accounts after bad debt expense is recorded?

• A)$7,950.
• B)$6,750.
• C)$5,550.
• D)$7,800.

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Definitions:

Communicate

The act of conveying information or expressing thoughts and feelings through speech, writing, signals, or other means.

Idea

A thought or suggestion as to a possible course of action, concept, or level of understanding.

GPA

Grade Point Average, a numerical calculation that represents the average value of the accumulated final grades earned over time from courses taken.

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A type of graph that uses lines to connect individual data points, displaying trends over a period of time or category.