The General Ledger Account for Accounts Receivable Shows a Debit

question 2

Multiple Choice

The general ledger account for Accounts Receivable shows a debit balance of $25,000. Allowance for Uncollectible Accounts has a credit balance of $1,500. Net sales for the year were $250,000. In the past, 3 percent of sales have proved uncollectible, and an aging of accounts receivable resulted in an estimate of $10,000 of uncollectible accounts receivable. Using the percentage of net sales method, the Allowance for Uncollectible Accounts balance (after adjustment) would be

• A) $7,500.
• B) $10,000.
• C) $9,000.
• D) $6,000.

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Definitions:

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