Business, 06.03.2020 23:33 GravityShifter13

On January 1, Year 2, Kincaid Company's Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $73,800 and $3,500, respectively. During the year Kincaid reported $204,000 of credit sales. Kincaid wrote off $1,950 of receivables as uncollectible in Year 2. Cash collections of receivables amounted to $252,100. Kincaid estimates that it will be unable to collect one percent (1%) of credit sales.

Which of the following describes the effects of Kincaid's entry to recognize the write-off of the uncollectible accounts?

a. Increase assets and stockholders' equity.
b. Increase assets and decrease stockholders' equity.
c. assets and stockholders' equity.
d. Does not affect assets or stockholders' equity.

Answers: 2

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On January 1, Year 2, Kincaid Company's Accounts Receivable and the Allowance for Doubtful Accounts...

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