On Average,5% of Total Accounts Receivable Has Been Uncollectible in the Past.At

question 109

Multiple Choice

On average,5% of total accounts receivable has been uncollectible in the past.At the end of the year,the balance of accounts receivable is $100,000 and the allowance for doubtful accounts has a credit balance of $500.Credit sales during the year were $150,000.Using the aging of accounts receivable method,the estimated bad debt expense would be:

• A)$4,500.
• B)$5,000.
• C)$5,500.
• D)Cannot be determined; the aging of accounts receivable method cannot be used as the information provided can only be used for calculating the percentage of credit sales method.

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