Answer:
The company believes that 2 percent of its credit sales will be uncollectible.
The net realizable value of receivables at the end of the year would be:
C)
$3,110.
Explanation:
There is one option missing:
Balances
Dr Accounts receivable $ 3,400
Dr Allowance for Uncollectible Accounts $ 50
The company believes that 2 percent of its credit sales will be uncollectible.
Dr Bad Debt Expense $ 290
Cr Allowance for Uncollectible Accounts $ 290
The net realizable value of receivables at the end of the year would be
$ 3,110
Ellis Company started the year with a $4,600 balance in accounts receivable and a $150 balance in the allowance for doubtful accounts.
Dr Accounts receivable $ 4,600
Cr Allowance for Uncollectible Accounts $ 150
The company had credit sales of $12,000
Dr Accounts receivable $ 12,000
Cr Sales $ 12,000
Collections on accounts receivable of $13,000,
Dr CASH $ 13,000
Cr Accounts receivable $ 13,000
Wrote off uncollectible accounts of $200 during the year
Dr Allowance for Uncollectible Accounts $ 200
Cr Accounts receivable $ 200
