Johnson computes bad debts as a percentage of sales. If 2% of sales amounts to $2,000 and the Allowance account currently has a balance of $900, the bad debts adjustment should be in the amount of:
A. $2,000
B. $2,900
C. $1100
D. None of these
Answer:A
Johnson computes bad debts as a percentage of sales. If 2% of sales amounts to $2,000 and the Allowance account currently has a balance of $900, the bad debts adjustment should be in the amount of:
A. $2,000 B. $2,900 C. $1100 D. None of these