Essay
A company had the following items and amounts in its unadjusted trial balance as of December 31 of the current year:
Prepare the adjusting entry to estimate bad debts under each of the following separate situations.
a.Bad debts are estimated to be 2.5% of credit sales.
b.An aging analysis estimates that 8% of the outstanding accounts receivable will be uncollectible.
Correct Answer:
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