Question

At December 31, 2018, Oriole Company reported the following information on its balance sheet.

Accounts receivable $948,000
Less: Allowance for doubtful accounts 78,000
During 2019, the company had the following transactions related to receivables.
1. Sales on account $3,609,930
2. Sales returns and allowances 51,000
3. Collections of accounts receivable 2,756,000
4. Write-offs of accounts receivable deemed uncollectible 97,000
5. Recovery of bad debts previously written off as uncollectible 28,000
Compute the accounts receivable turnover for 2019, assuming the expected bad debt information provided in (c). (Round answer to 2 decimal places, e.g. 25.25.)

Answer 1

Bad debt expense (Dr.) $68,930

Allowance for Doubtful Debt (Cr.) $68,930

Step-by-step explanation:

Accounts Receivable :

Balance $948,000

Add: Sales $3,609,930

Less: Sales returns $51,000

Less: Collections $2,756,000

Less: Write offs $97,000

Add: Recovery of old Bad debts $28,000

Adjusted Balance $1,653,930

Bad Debts :

Balance $78,000

Less: Allowance for doubtful debts $97,000

Less: Recovery $28,000

Adjusted Balance $9,000