Question

A newly created design​ business, Teri's​ Art, is finishing its first year of operations. During the​ year, credit sales were $ 42,000 and collections of credit sales were $ 34,000. One account for $ 650 was written off.​ Teri's Art uses the aging-of-receivables method to account for bad debts expense. It has estimated $ 200 as uncollectible at yearminusend. What is the amount of the Bad Debts Expense for the first year of​ operations?

Answer 1

The bad debt expense for the year was 650

Step-by-step explanation:

bad debt expense 200 DEBIT

allowance 200 CREDIT

allowance 200 DEBIT

bad debt expense 450 DEBIT

account receivable 650 CREDIT

The bad debt expense for the year was 650