At the End of the Current Year, the Trial Balance

question 69

Short Answer

At the end of the current year, the trial balance of Monique's Fashion Industries included the accounts and balances shown below. Credit sales were $6,400,000. Returns and allowances on these
sales were $57,200. Assume that the firm bases its estimate of the loss from uncollectible accounts on0.3 percent of net credit sales.
Accounts Receivable $ 650,000 Dr. Allowance for Doubtful Accounts 4,500 Cr.
Sales 7,000,000 Cr.
Sales Returns and Allowances 55,000 Dr.
1. What is the estimated loss from uncollectible accounts for the current year?
2. What is the amount of the adjusting entry for the estimated loss from uncollectible accounts? (Round your answers to the nearest dollar.)

---

Definitions:

Important Activities

Tasks or actions that hold significant value or priority in achieving goals or fulfilling responsibilities.

FOB

An acronym for "Free On Board," a term used in shipping agreements to indicate that the seller is responsible for the goods until they are loaded onto a vessel at the specified location.

FAS

Generally refers to Financial Accounting Standards, which are guidelines for how financial reports are to be prepared by companies.

Void Title

Not true title; e.g., the title held by someone who knowingly or unknowingly purchased stolen goods.