Over the Past Five Years,a Company Had Average Annual Credit

Multiple Choice

Over the past five years,a company had average annual credit sales of $320,000 and an average annual net write-offs of $2,000.Credit sales in the current year are $300,000.Using the percentage of credit sales method,what should the company record as an estimate of bad debt expense?

A) $2,000
B) $1,875
C) $20,000
D) $6,000