Jensen Corporation Uses the Percentage-Of-Sales Method to Estimate Uncollectibles

question 68

Multiple Choice

Jensen Corporation uses the percentage-of-sales method to estimate uncollectibles.Net credit sales for the current year amount to $2,010,000 and management estimates 3% will be uncollectible.The Allowance for Doubtful Accounts prior to adjustment has a debit balance of $18,000.After all adjusting entries are made,the balance in Allowance for Uncollectible Accounts will be:

• A)$18,000.
• B)$18,540.
• C)$42,300.
• D)$60,300.

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