Wellington Corp

question 168

Multiple Choice

Wellington Corp. has outstanding accounts receivable totaling $6.5 million as of December 31 and sales on credit during the year of $24 million. There is also a credit balance of $12,000 in the allowance for doubtful accounts. If the company estimates that 8% of its outstanding receivables will be uncollectible, what will be the amount of bad debt expense recognized for the year?

• A) $ 532,000.
• B) $ 520,000.
• C) $1,920,000.
• D) $ 508,000.

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Definitions:

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