Dodge Company had the following information relating to its accounts receivable at December 31, 2002, and for the year ended December 31, 2003:
|
Accounts receivable balance at 12/31/02 |
$900,000 |
|
Allowance for bad debts at 12/31/02 (credit balance) |
50,000 |
|
Gross sales during 2003 (all credit). |
5,000,000 |
|
Collections from customers during 2003 |
4,500,000 |
|
Accounts written off as uncollectible during 2003 |
60,000 |
|
Estimated uncollectible receivables at 12/31/03 |
110,000 |
Dodge Company uses the percentage of receivables method to estimate bad debt expense.
1. At December 31, 2003, what is the balance of Dodge Company s Allowance for Bad Debts? What is the bad debt expense for 2003?
2. At December 31, 2003, what is the balance of Dodge Company s gross accounts receivable?