Question

Radek Company estimates its uncollectible accounts by aging its accounts receivable and applying percentages to various aged categories of accounts. Radek computes a total of $3,200 in estimated uncollectible accounts as of its current year-end. Its accounts receivable has a balance of $73,000, and its allowance for uncollectible accounts has an unused balance of $900 before any year-end adjustments. What amount of bad debts expense will Radek Company report in its income statement for the current year

Answer 1

the bad debt expense that reported in the income statement is $2,300

Step-by-step explanation:

The computation of the bad debt expense that reported in the income statement is as follows;

= Total estimated uncollectible accounts - unused balance

= $3,200 - $900

= $2,300

Hence, the bad debt expense that reported in the income statement is $2,300