Calistoga Produce estimates bad debt expense at 0.40% of credit sales. The company reported accounts receivable and allowance for uncollectible accounts of $475,000 and $1,600 respectively, at December 31, 2020. During 2021, Calistoga's credit sales and collections were $324,000 and $313,000, respectively, and $1,770 in accounts receivable were written off. Calistoga's final balance in its allowance for uncollectible accounts at December 31, 2021, is: Multiple Choice $1,031. $2,011. $1,126. $1,776.
Calistoga Produce estimates bad debt expense at 0.40% of credit sales. The company reported accounts receivable and allowance for uncollectible accounts of $475,000 and $1,600 respectively, at December 31, 2020. During 2021, Calistoga's credit sales and collections were $324,000 and $313,000, respectively, and $1,770 in accounts receivable were written off. Calistoga's final balance in its allowance for uncollectible accounts at December 31, 2021, is: Multiple Choice $1,031. $2,011. $1,126. $1,776.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 6MC: Prior to adjustments, Barrett Companys account balances at December 31, 2019, for Accounts...
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Please provide the solution along with the calculation and provide an explanation for both the correct and incorrect answers.
Transcribed Image Text:Calistoga Produce estimates bad debt expense at 0.40% of credit sales. The
company reported accounts receivable and allowance for uncollectible accounts
of $475,000 and $1,600 respectively, at December 31, 2020. During 2021,
Calistoga's credit sales and collections were $324,000 and $313,000,
respectively, and $1,770 in accounts receivable were written off.
Calistoga's final balance in its allowance for uncollectible accounts at December
31, 2021, is:
Multiple Choice
О
$1,031.
О
$2.011.
О
$1,126.
$1,776.
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