The Following Information Pertains to Lightning,Inc Lightning Uses the Aging Method and Estimates It Will Not

question 49

Multiple Choice

The following information pertains to Lightning,Inc.at the end of December:
$$\begin{array} { l r } \text { Credit Sales } & \$ 60,000 \\\text { Accounts Payable } & 10,000 \\\text { Accounts Receivable } & 7,000 \\\text { Allowance for Uncollectible Accounts } & \$ 400 \text { credit } \\\text { Cash Sales } & 20,000\end{array}$$ Lightning uses the aging method and estimates it will not collect 2% of accounts receivable not yet due,10% of receivables less than 30 days past due,and 40% of receivables greater than 30 days past due.The accounts receivable balance of $7,000 consists of $3,500 not yet due,$2,000 less than 30 days past due,and $1,500 greater than 30 days past due.What is the appropriate amount of Bad Debt Expense?

• A)$400.
• B)$470.
• C)$870.
• D)$1,270.

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Definitions:

Scrambled Eggs

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A tube inserted through the abdomen directly into the stomach for feeding purposes, usually when someone cannot eat by mouth.

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A method of feeding that bypasses the gastrointestinal tract, delivering nutrients directly into the bloodstream.

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Difficulty or discomfort in swallowing, which can be due to a range of conditions affecting the throat or esophagus.