Use This Information to Answer the Following Question

question 95

Multiple Choice

Use this information to answer the following question. The general ledger account for Accounts Receivable shows a debit balance of $50,000.Allowance for Uncollectible Accounts has a credit balance of $1,000.Net sales for the year were $500,000.In the past,2 percent of sales have proved uncollectible,and an aging of accounts receivable accounts results in an estimate of $11,700 of uncollectible accounts.
Using the accounts receivable aging method,the Allowance for Uncollectible Accounts balance would be credited for

• A)$10,700.
• B)$11,700.
• C)$12,200.
• D)$12,700.

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Definitions:

Service Department Costs

Expenses associated with departments that do not directly produce goods but provide essential support services to production departments.

Operating Departments

Departments within an organization that are directly involved in producing the company's goods or delivering services, as opposed to administrative departments.

Process Costing

A costing method used in industries where production is continuous and units are identical, assigning costs to units of product based on the process they go through.

Inventory

An asset that represents the total amount of goods and or materials a company holds for sale or production in the normal course of business.