On December 31 of the Current Year, Quick Draw Corporation

Essay

On December 31 of the current year, Quick Draw Corporation had the following:
Total sales for the current year of: $880,000, including $120,000 in cash sales.
$\begin{array}{|l|r|}\hline \text { Accounts receivable balance at Dec. 31 of}&\$ 200,000.00\\\text { the curyent year:}\\\hline \text { Bad debts written off during the current } & \$ 2,800.00 \\\text { year: } & \\\hline \begin{array}{l}\text { Credit balance of Allowance for Doubtful } \\\text { Accounts at January } 1 \text { of the current year: }\end{array} & \underline{\$ 2,300.00} \\\hline\end{array}$ Prepare any adjusting entries required to record bad debts expense for the current year, assuming Quick Draw estimates bad debts will be: (a) About 1.5% of credit sales. (b) About 5% of accounts receivable.