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I am so utterly confused!
Doing MCQ via Ninja and this question comes up:On January 1, Jam Co. had a credit balance of $260,000 in its allowance for uncollectible accounts. Based on past experience, 2% of Jam’s accounts receivable have been uncollectible. During the year, Jam wrote off $325,000 of uncollectible accounts. Accounts Receivable at the end of the year was $9,000,000. In its December 31 year-end balance sheet, what amount should Jam report as an allowance for uncollectible accounts?
A. 180
B. 115
C. 245
D. 440Answer A. 180
Now it didn’t make sense why it would be 180 so I googled to try to see if I can find an explanation and anywhere I check the answer is B 115 not A. Why the heck are the answers different?
Here’s a link to the same question posted here back in 2015
When to consider credit balance in doubtful/uncollectible accounts?
AUD - NINJA in Training
BEC - NINJA in Training
FAR - NINJA in Training
REG - NINJA in TrainingNeed This To Be Over ...
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