At the Beginning of 2015, Peter Dots Has the Following

question 25

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%.
-Refer to the table above,The ending balance in the Allowance for Bad Debts would be:

• A) $5,000.
• B) $6,500.
• C) $6,400.
• D) $7,000.

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