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Home > Business & Careers > Accounting   »   Bad Debt and Bad Debt allocation

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Old Feb 2, 2007, 07:48 PM
mibenzo
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Bad Debt and Bad Debt allocation

Can someone help with the following accounting exercise?

The following info was listed in company X balance sheet as of 2005

Aacounts Rec for 2004 150,000
Aacounts Rec for 2005 250,000

Allowance for bad debt in 2004 was 8,200
Allowance for bad debt in 2005 was 12,000

The actual amount of bad debt on the income statement was 7,700 in 2004 and 10,500 in 2005. What was the amount of write off in 2005?

The answer is not 10,500 but I think it should be 10,500.

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Old Mar 18, 2007, 02:32 AM   #2  
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Quote:
Originally Posted by mibenzo
Can someone help with the following accounting exercise?

The following info was listed in company X balance sheet as of 2005

Aacounts Rec for 2004 150,000
Aacounts Rec for 2005 250,000

Allowance for bad debt in 2004 was 8,200
Allowance for bad debt in 2005 was 12,000

The actual amount of bad debt on the income statement was 7,700 in 2004 and 10,500 in 2005. What was the amount of write off in 2005?

The answer is not 10,500 but I think it should be 10,500.
I believe the answer is $6,700. 2004 Allowance $8,200 + 2005 BD Exp 10,500=$18,700 less ending 2005 Allowance of $12,000.
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