Business, 09.10.2019 04:00 larenhemmings

Sage company has recorded bad debt expense in the past at a rate of 1.5% of accounts receivable, based on an aging analysis. in 2017, sage decides to increase its estimate to 2%. if the new rate had been used in prior years, cumulative bad debt expense would have been $387,800 instead of $299,000. in 2017, bad debt expense will be $122,400 instead of $91,130. if sage’s tax rate is 27%, what amount should it report as the cumulative effect of changing the estimated bad debt rate?

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Sage company has recorded bad debt expense in the past at a rate of 1.5% of accounts receivable, bas...

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