The Data Presented Below for Lynx Corp -See the Data for Lynx Corp

question 65

Multiple Choice

The data presented below for Lynx Corp.is for the year ended December 31, 2016: $$\begin{array} { l r } \text { Sales (100\% on credit) } & \$ 1,000,000 \\\text { Sales returns } & 30,000 \\\text { Accounts Receivable (December 31,2016) } & 170,000 \\\text { Allowance for Doubtful Accounts [Cr. B alance] } & \\\quad \text { (Before adjustment at December 31, 2016) } & 1,300 \\\text { Estimated amount of uncollectible accounts based on aging analysis } & 14,000\end{array}$$
-See the data for Lynx Corp. If Lynx Corp.uses the aging of accounts receivable approach to estimate its bad debts, what amount will be reported as bad debt expense for 2016?

• A) $12,700
• B) $13,700
• C) $14,000
• D) $15,300

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Definitions:

Liability

The legal responsibility of an individual for his or her actions.

Fur Coat

A coat made from the fur of animals, worn for warmth or as a fashion statement.

Bailment

The act of temporarily transferring physical possession of personal property by one party (the bailor) to another (the bailee) for a specific purpose.

Mutuum

A loan of goods with the intention that the goods may be used and later replaced with an equal amount of different goods.