Final answer:
The allowance for bad debt on a $50,000 receivable balance, with an estimate that 1.9% is uncollectible, is $950. This is found by multiplying the receivable balance by the uncollectible percentage, providing an accurate representation of expected losses in financial statements.
Step-by-step explanation:
The main answer to the question of determining the appropriate allowance for bad debt for an Accounts Receivable account with a balance of $50,000, when the company estimates that 1.9% of receivables will be uncollectible, is that the company should enter $950 as the allowance for bad debt.Explanation in more than 100 words: Bad debt expense is a projection of the amount of money that is not expected to be collected from outstanding accounts receivable. To calculate the bad debt expense, multiply the total balance of accounts receivable by the percentage the company believes will be uncollectible. In this case, the calculation would be 1.9% of $50,000, which equals $950. This figure is calculated by taking 0.019 and multiplying it by 50,000, resulting in an allowance for bad debt of $950. This ensures the company accurately reflects anticipated losses in their financial statements.Conclusion: The correct allowance for bad debt that should be recorded in the financial statements is $950 (option c), which reflects a realistic expectation of potential losses due to uncollectible accounts receivable.