Ngo Company uses the allowance method of accounting for bad debts. The following summary schedule...
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Ngo Company uses the allowance method of accounting for bad debts. The following summary schedule was prepared from an aging of accounts receivable outstanding on December 31 of the current year. No. of Days Probability Outstanding Amount of Collection 0-30 days $500,000 .98 31-60 days 200,000 Over 60 days 150,000 .80 .90 The following additional information is available for the current year: Net credit sales for the year $4,000,000 Allowance for Doubtful Accounts: Balance, January 1 45,000 (cr) Balance before adjustment, December 4,000 (dr) 31 5. See Ngo Company's information above. If the company determines bad debt expense using 1.5 percent of net credit sales, the net realizable value of accounts receivable on the December 31 balance sheet will be A. $846,000 B. $786,000 C. $790,000 D. $794,000 See Ngo Company's information above. If Ngo Company bases its estimate of bad debts on the aging of accounts receivable, the bad debts expense for the current year ending December 31 is A. $15,000. B. $60,000. C. $64,000. D. $50,000
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