The Allowance for Bad Debts Account Has a Credit Balance

question 47

Multiple Choice

The Allowance for Bad Debts account has a credit balance of $3,000 before the adjusting entry for bad debts expense.The company's management estimates that 5% of net credit sales will be uncollectible for the year 2017.Net credit sales for the year amounted to $290,000.What is the amount of Bad Debts Expense reported on the income statement for 2017?

• A)$14,500
• B)$17,500
• C)$7,250
• D)$11,500

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Definitions:

Attitude

A settled way of thinking or feeling about something, typically reflected in a person's behavior.

Behavior

The actions or reactions of an individual or a system in response to external or internal stimuli.

Principles Of Persuasion

Fundamental strategies used to convince others to change their attitudes or behaviors, involving factors such as authority, social proof, reciprocity, commitment and consistency, liking, and scarcity.

Advertisers

Professionals engaged in the creation and placement of advertisements to promote products or services to targeted audiences.