At the Beginning of 2015, Peter Dots Has the Following

question 102

Multiple Choice

At the beginning of 2015, Peter Dots has the following ledger balances: During the year, credit sales amounted to $800,000. Cash collected on credit sales amounted to $760,000 and $18,000 has been written off. At the end of the year, company adjusted for bad debts expense using the percent-of-sales method and applied a rate, based on past history, of 2.5%. The ending balance in Bad Debts Expense would be:

• A)$20,000.
• B)$40,000.
• C)$28,000.
• D)$27,000.

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