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    mibenzo's Avatar
    mibenzo Posts: 1, Reputation: 1
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    #1

    Feb 2, 2007, 08:48 PM
    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.
    ernestcm's Avatar
    ernestcm Posts: 1, Reputation: 1
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    #2

    Mar 18, 2007, 02:32 AM
    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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