Based on the Following Information If Bad Debts Are Estimated to Be 2% of Net

question 6

Multiple Choice

Based on the following information: $\begin{array}{lr}\text {Sales returns and allowances(credit sales) }&\$ 20,000\\\text {Cash sales }&1,200,000 \\\text {Unadjusted balance in Allowance for Doubtful Accounts }&1,000\text { credit }\\\text {Creclit sales }&2,550,000\\\end{array}$
If bad debts are estimated to be 2% of net credit sales, the adjusting entry to recognize uncollectible accounts will include a debit to expense for

• A)$52, 000
• B)$51, 000
• C)$50, 000
• D)$50, 600

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