A company uses the percent of sales method to determine its…
A company uses the percent of sales method to determine its bad debts expense. At the end of the current year, the company’s unadjusted trial balance reported the following selected amounts:Accounts receivable $375,000 debitAllowance for uncollectible accounts 500 debitNet Sales 800,000 creditAll sales are made on credit. Based on past experience, the company estimates 0.6% of net credit sales to be uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?
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