Determine the bad debt expense for year

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Reference no: EM1393849

A recent annual report for Target contained the following information (dollars in thousands) at the end of its fiscal year:

	Year 2			Year 1
Accounts receivable	$	9,085,000		$	8,632,000
Allowance for doubtful accounts		(1,018,000	)		(569,000	)

	$	8,067,000		$	8,063,000

A footnote to the financial statements disclosed that uncollectible accounts amounting to $828,000 and $419,000 were written off as bad debts during year 2 and year 1, respectively. Assume that the tax rate for Target was 40 percent.

Required:

1. Determine the bad debt expense for year 2 based on the preceding facts. (Hint:Use the Allowance for Doubtful Accounts T-account to solve for the missing value.)(Enter your answer in thousands. Omit the "tiny_mce_markerquot; sign in your response.)

Reference no: EM1393849

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