At the End of the Current Year,Accounts Receivable Has a Balance

question 15

Multiple Choice

At the end of the current year,Accounts Receivable has a balance of $550,000; Allowance for Doubtful Accounts has a credit balance of $5,500; and sales for the year total $2,500,000.An analysis of receivables estimates uncollectible receivables as $25,000. Determine the amount of the adjusting entry for bad debt expense and the adjusted balance of Allowance of Doubtful Accounts,respectively.

• A)$19,500 and $25,000
• B)$30,500 and $525,000
• C)$19,500 and $525,000
• D)$30,500 and $25,000

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Definitions:

Materials Quantity Variance

A financial metric used in cost accounting to measure the difference between the actual quantity of materials used in production and the expected quantity.

Cost of Goods Sold

The immediate expenses related to the production of a company's sold goods, involving materials and labor.

Labor Efficiency Variance

Labor efficiency variance is a measure of the difference between the actual hours worked by employees versus the standard or expected hours worked to produce a certain amount of goods.

Labor Rate Variance

The difference between the actual cost of labor and the expected (or budgeted) cost, used in managerial accounting to monitor labor cost efficiency.