Temper Company Has Credit Sales of $3 Assuming the Company Uses the Percent of Accounts Receivable Method,what

question 42

Multiple Choice

Temper Company has credit sales of $3.10 million for year 2013.Accounts Receivable total $947,360 and the company estimates that 2% of accounts receivable will remain uncollectible.Historically,.9% of sales have been uncollectible.On December 31,2013,the company's Allowance for Doubtful Accounts has an unadjusted debit balance of $2,575.Temper prepared a schedule of its December 31,2013,accounts receivable by age.Based on past experience,it estimates the percent of receivables in each age category that will become uncollectible.This information is summarized here:
$\begin{array}{ccc}\text { December } 31,2013 & \text { Age of Accounts } & \text { Expected Percent } \\\text { Accounts Receivable } & \text { Receivable } & \text { Uncollectible }\\ \$620,000 & \text { Not yet due } & 1.05 \% \\248,000 & 1 \text { to } 30 \text { days past due } & 1.80 \\ 49,600 & 31 \text { to } 60 \text { dlays past due } & 6.30 \\ 24,800 & 61 \text { to } 90 \text { days past due } & 31.75 \\4,960 & \text { Over } 90 \text { days past due } & 66.00\end{array}$
Assuming the company uses the percent of accounts receivable method,what is the amount that Temper will enter as the Bad Debt Expense in the December 31 adjusting journal entry?

• A) $18,947.20
• B) $16,372.20
• C) $23,024.40
• D) $27,900.00
• E) $21,522.20

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Definitions:

Vitamin C

An essential nutrient that acts as an antioxidant, supports the immune system, and is necessary for the synthesis of collagen.

Kilocalories

A unit of energy defined as the amount of heat needed to raise the temperature of one kilogram of water by one degree Celsius, commonly used to quantify the energy content in food.

Dietary Intake

The amount and type of food and beverages consumed by an individual or population, significant for nutritional status and health.

Anabolism

All of the synthesis reactions that occur within the body; requires energy.