Essay
The following information was taken from the unadjusted trial balance and aging schedule of Diane Company on December 31, 2010. All sales are on account.
Accounts and related balances at December 31, 2010 before adjustment:
Aging Schedule of Accounts Receivable:
If Diane Company estimates bad debts as 6% of net credit sales, what is the amount of bad debts expense to be reported on the income statement for the period ending December 31, 2010?
a. $27,019
b. $29,820
c. $30,000
d. $29,779
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