Respuesta :
Bad debt expense for 2022 would be $4,425.
- Bad debt expense is the expense incurred by a company when a debtor of the company is unable to fulfuill their obligation to the company.
Bad debt expense for Coolwear Inc. would be calculated by = Allowance for Uncollectible Accounts - (Uncollectible Accounts Balance - Accounts Receivable Writeoff).
Bad debt expense = $5,400 - ($1,550 - $575).
= $4,425.
What are examples of bad debt expense?
- Big Store stops paying its debts and fails to reimburse Company XYZ for goods valued at $100,000.
- Company labels the $100,000 as a bad debt because it has little faith that Big Store will ever make good on its obligations.
Is bad debt expense a liability or expense?
- As the amount that was anticipated to be paid by the debtor is not recoupable and has a negative impact on the books of accounts by reducing the accounts receivable, bad debts constitute an expense to the firm rather than a liability.
Where is bad debt expense on balance sheet?
- The provision for doubtful debts is shown in the balance sheet immediately below the line item for accounts receivable and is a counter account to accounts receivable, therefore it should always have a credit balance.
Learn more about bad debt expense here:
https://brainly.com/question/18568784
#SPJ4
