XYZ Company had sales of $585,000 during Year 1, $260,000 of which were on account. The account balances in Accounts Receivable and in Allowance for Uncollectible Accounts on December 31 of Year 1 were $78,000 and $10,400 respectively. Past experience indicates that 5 percent of all credit sales will not be collected. An aging of accounts indicated that $19,500 of the receivable balance would not be collected. How much should XYZ Company debit to the Bad Debt Expense Account?
Correct Answer: $19,500
Explanation:
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