The balances of selected accounts of the Dexter Company onDecember 31, 2019, are given below: Accounts Receivable $ 850,000Allowance for Doubtful Accounts (credit) 3,000 Total Sales9,950,000 Sales Returns and Allowances (total) 240,000 (Creditsales were $8,500,000. Returns and allowances on these sales were$200,000.) Required: Compute the amount to be charged toUncollectible Accounts Expense under each of the followingdifferent assumptions: Uncollectible accounts are estimated to be0.1 percent of net credit sales. Experience has shown that about3.3 percent of the accounts receivable will prove worthless.Suppose Allowance for Doubtful Accounts has a debit balance of$2,500 instead of a credit balance of $3,000, but all other accountbalances remain the same. Compute the amount to be charged toUncollectible Accounts Expense under each assumption in item 1.Analyze: If you were the owner of Dexter Company and wished tomaximize profits reported for 2019, which method would you preferto use? Complete this question by entering your answers in the tabsbelow. Req 1aReq 1bReq 2aReq 2bAnalyze Uncollectible accounts areestimated to be 0.1 percent of net credit sales. Compute the amountto be charged to Uncollectible accounts. (Round your ''Estimatedloss rate'' to 3 decimal places, i.e. 1.2% should be entered as0.012.) Credit sales Net credit sales Estimated loss rate Amount tobe charged to uncollectible accounts expense Req 1aReq 1b
