Vine Company Began Operations on January 1, 2013

question 152

Multiple Choice

Vine Company began operations on January 1, 2013. During its first year, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows:
a. Sold $1,348,300 of merchandise (that had cost $983,600) on credit, terms n/30.
b. Wrote off $19,400 of uncollectible accounts receivable.
c. Received $666,100 cash in payment of accounts receivable.
d. In adjusting the accounts on December 31, the company estimated that 2.90% of accounts receivable will be uncollectible.
What is the amount required for the adjusting journal entry to record bad debt expense?

• A) $18,644.90
• B) $38,621.20
• C) $19,783.80
• D) $19,221.20
• E) $19,400.20

---

Definitions:

Causal Factor

An element or condition that directly influences the occurrence of an event or the outcome of a process.

Bathroom Floor

The surface or part of a bathroom upon which one stands, often made of tile, linoleum, or other water-resistant material.

Leak

The accidental escape of a fluid or gas through a hole or crack, or the disclosure of confidential information.

Plumbing

The system of pipes, drains, fittings, valves, and fixtures installed for the distribution of water for drinking, heating, and washing, and the removal of waterborne wastes.