Response to the following problem:
At the end of the current year, the accounts receivable account has a debit balance of $775,000, and net sales for the year total $6,000,000.
Determine the amount of the adjusting entry to provide for doubtful accounts under each of the following assumptions:
a. The allowance account before adjustment has a credit balance of $4,750. Bad debt expense is estimated at 1 - 4 of 1% of net sales.
b. The allowance account before adjustment has a credit balance of $3,750. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $18,350.
c. The allowance account before adjustment has a debit balance of $5,050. Bad debt expense is estimated at 1 - 2 of 1% of net sales.
d. The allowance account before adjustment has a debit balance of $5,050. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $31,400.