Santagos Industries Gathered the Following Information from Its Accounting Records $\quad \$ 730,000$

question 38

Essay

Santagos Industries gathered the following information from its accounting records for the year ended December 31, 2019, prior to adjustment: Net credit sales for the year $\quad \$ 730,000$
Accounts receivable balance, Dec. 31, 2019142,000
Allowance for doubtful
accounts balance, Dec. $31,2019 \quad 1,850 \quad$ Dr. Santagos uses the allowance method of accounting for uncollectible accounts and estimates bad-debt expense at 1.5% of net credit sales.
Required:
a)Prepare the adjusting entry to record bad-debt expense on December 31, 2019.
b)Determine the balance in allowance for doubtful accounts after the adjusting entry is prepared.
c)Show how the receivables would be reported on the December 31, 2019, balance sheet for Santagos Industries.

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Definitions:

Population

The total set of individuals, items, or data points that are of interest in a statistical analysis, from which samples may be drawn for study.

Descriptive

Descriptive refers to the statistical techniques or studies that aim to summarize or describe a set of data without making inferential predictions or determinations about the data.

Nominal

Describing a data classification that categorizes data without a natural order or ranking.

Inferential Statistics

The branch of statistics that allows for the making of predictions or inferences about a population based on a sample of data.