Tanning Company Analyzes Its Receivables to Estimate Bad Debt Expense

question 39

Multiple Choice

Tanning Company analyzes its receivables to estimate bad debt expense.The accounts receivable balance is $390,000 and credit sales are $1,300,000.An aging of accounts receivable shows that approximately 5% of the outstanding receivables will be uncollectible.What adjusting entry will Tanning Company make if the Allowance for Doubtful Accounts has a credit balance of $2,500 before adjustment?

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Definitions:

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Match Your Approach

The strategy of aligning your communication or action methods with the situation, audience, or expected outcomes for better effectiveness.

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Element of Surprise

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