Question:\nDuncan Company reports the following financial information before adjustments.\nDr. Cr.\nAccounts Receivable $100,000\nAllowance for Doubtful A
Question:
\r\nDuncan Company reports the following financial information before adjustments.
\r\nDr. Cr.
\r\nAccounts Receivable $100,000
\r\nAllowance for Doubtful Accounts $ 2,000
\r\nSales Revenue (all on credit) 900,000
\r\nSales Returns and Allowances 50,000
\r\nInstructions
\r\nPrepare the journal entry to record Bad Debt Expense assuming Duncan Company estimates bad debts at (a) 1% of net sales and (b) 5% of accounts receivable.