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

question 37

Multiple Choice

Temper Company has credit sales of $3.10 million for year 2010.Temper estimates that .9% of the credit sales will not be collected.On December 31,2010,the company's Allowance for Doubtful Accounts has an unadjusted credit balance of $2,222.Temper prepares a schedule of its December 31,2010,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:
$$\begin{array} { c l c } \begin{array} { c } \text { December 31,2010 } \\\text { Accounts Receivable }\end{array} &{ \begin{array} { c } \text { Age of Accounts } \\\text { Receivable }\end{array} } & \begin{array} { c } \text { Expected Percent } \\\text { Uncollectible }\end{array} \\\$ 620,000 & \text { Not yet due } & 1.05 \% \\248,000 & 1 \text { to 30 days past due } & 1.80 \\49,600 & 31 \text { to 60 days past due } & 6.30 \\24,800 & \text { 61 to 90 days past due } & 31.75 \\4,960 & \text { Over 90 days past due } & 66.00\end{array}$$
Assuming the company uses the percent of sales method,what is the amount that Temper will enter as the Bad Debt Expense in the December 31 adjusting journal entry?

• A)$25,246.40
• B)$27,468.40
• C)$23,024.40
• D)$27,900.00
• E)$24,420.40

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Definitions:

Chromosome

A long strand of DNA that is associated with proteins and organized into a compact structure, carrying genetic information in the form of genes.

Crossing Over

The exchange of genetic material between homologous chromosomes during meiosis, leading to genetic diversity in offspring.

Hybrid Offspring

The result of reproduction between two different species or varieties, leading to offspring that share characteristics of both parents.

Paternal Alleles

Genetic variants located on the chromosomes inherited from the father.