Actual Adjustment for Bad Debt Expense Calculation | CFA® Level 1 Exam Prep

Actual Adjustment for Bad Debt Expense Calculation

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Question

Which of the following is used to calculate the actual adjustment for bad debt expense for the period?

Answers

Explanations

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A. B. C. D.

Explanation

The aging and percent of Accounts Receivable methods calculate what the balance of the allowance account should be, however, percent of net sales method calculates the actual expense for the period.