Question

Hughes has a debit balance of $5,000 in its Allowance for Doubtful Accounts before any adjustments are made at the end of the year. Based on the review and aging of its accounts receivable at the end of the year, Hughes estimates that $60,000 of its receivables are uncollectible. In this situation, the amount of bad debt expense that should be reported for the year is?

Answer 1

Bad debt expense : $ (55,000)

Explanation:

Allowance : $ 5000

Uncollected receivables : $ (60,000)

Bad debt expense : $ (55,000)