The following information is from the 2017 records of Robin Antique Shop
Accounts receivable, December 31, 2017 $44,000 (debit)
Allowance for Bad Debts, December 31, 2017
prior to adjustment 1,100 (debit)
Net credit sales for 2017 176,000
Accounts written off as uncollectible during 2017 11,000
Cash sales during 2017 27,000
Bad debts expense is estimated by the percent-of-sales method. Management estimates that 5% of net credit sales will be uncollectible. The ending balance of the Allowance for Bad Debts account after adjustment will be ________.
A) $9,900
B) $9,050
C) $11,250
D) $7,700
D .Estimated Bad Debt Expense - Allowance account balance (Debit) = $8,800 - $1,100 = $7,700
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