On January 1, 2014 the Accounts Receivable and the Allowance

question 22

Multiple Choice

On January 1, 2014 the Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $30,000 and $500, respectively. During the year the company reported $75,000 of credit sales. There were $550 of receivables written-off as uncollectible in 2014. Cash collections of receivables amounted to $74,550. The company estimates that it will be unable to collect one percent (1%) of credit sales.
The amount of uncollectible accounts expense recognized in the 2014 income statement will be

• A) $700.
• B) $300.
• C) $750.
• D) $550.

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Definitions:

Arachnoid

A delicate, lacelike membrane covering the central nervous system.

Encephalitis

Inflammation of the brain, often caused by infections (viral, bacterial, fungal, or parasitic) or autoimmune diseases.

Quadriplegia

A condition characterized by paralysis of all four limbs, typically resulting from injury or disease affecting the spinal cord.

Paralysis

The loss of the ability to move one or more muscles, often as a result of damage to the nervous system.