Question

Bad debts expense is estimated by the percent-of-sales method. The management estimates that 3% of net credit sales will be uncollectible. Calculate the amount of bad debts expense for 2015 and prepare the Journal Entry.

Answer 1

Step-by-step explanation:

Total Sales = 75,000

Bad debt = 75,000*3% = 2250

Entry: Debit Credit

Bad debt expense 2250

Allowance for Doubtful debt 2250