a-companys-aging-schedule-shows-an-ending-allowance-of-5000-the-beginning-balanc

Question

A company’s aging schedule shows an ending allowance of $$5,000. The beginning balance was 2$$,000, and $$1,500 of accounts were written off. The company’s controller claims the bad debt expense is 3$$,000. Is this correct?

Accepted Answer

No, the correct bad debt expense is $4,500.

Answer

Yes, the controller’s calculation is correct.

Answer

No, the correct bad debt expense is $2,500.

Answer

No, the correct bad debt expense is $6,500.

A company’s aging schedule shows an ending allowance of \$5,000. The beginning balance was \$2,000, and \$1,500 of accounts were written off. The company’s controller claims the bad debt expense is \$3,000. Is this correct?