Class Quest Company had the following balances as at January 1, 2016: Accounts Receivable $600,000

Class Quest Company had the following balances as at January 1, 2016:

Accounts Receivable $600,000 Debit

Allowance for Doubtful Accounts $32,000 Credit

During the fiscal year 2016 (Jan 1 to Dec 31 2016), the company had the following transactions:

Total Sales $7,200,000 (of which 40% represents cash sales).

Cash collected from credit customers $3,000,000

Write-offs of uncollectible accounts $22,000.

Required: If the company estimates that 2.50% of its accounts receivable balance is uncollectible, calculate the ending balance in the allowance for doubtful accounts.

Expert Solution

ekkarill92 answered 1 year ago

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