Flyer Company has provided the following Information prior to any year-end bad d

Question

Flyer Company has provided the following Information prior to any year-end bad debt adjustment: Cash sales, $157,000 Credit sales. $457,000 Selling and administrative expenses. $117,000 Sales returns and allowances. $37,000 Gross profit, $497,000 Accounts receivable. $175,000 Sales discounts. $21,000 Allowance for doubtful accounts credit balance. $1,900 Ryer estimates bad debt expense assuming that 2.5% of credit sales have historically been uncollectible. How much is Flyer's bad debt expense? $13,450 $9,525 $13,325 $11,425

Explanation / Answer

Ending allowance for doubtful expenses =11425

Credit sales * % bad debt exp

457000*2.50%

Less:-

opeing allowance for doubtful expenses 1900

Bad Debts Expenses = 9525

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