Smart Art Is a New Establishment

question 77

Multiple Choice

Smart Art is a new establishment.During the first year,there were credit sales of $40,000 and collections of credit sales of $35,000.One account for $650 was written off.The company decided to use the percentage of sales method to account for bad debts expense and decided to use a factor of 3% for their year-end adjustment of bad debts expense.At the end of the year,the balance of bad debts expense would be:

• A)$550
• B)$650
• C)$2250
• D)$1200

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Definitions:

Wisdom

The quality of having experience, knowledge, and good judgment.

Age

The length of time that a person or object has existed, often used to denote the period since birth.

Franz Gall

An early 19th-century neuroanatomist and physiologist, known for developing phrenology, a theory linking brain areas to different personality traits.

Personality Traits

Enduring characteristics or qualities that define individuals and influence their behaviors and attitudes.