Credit sales method to record bad debt

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Reference no: EM13150122

Credit sales of $1,500,000 for fiscal year 2010.

12/31/10 Accounts Receivable balance of $250,000.

12/31/10 Allowance for Doubtful Accounts credit balance of $2,000 before adjusting journal entries are recorded.

Lighthouse, Inc. uses the percentage of credit sales method to record bad debt and estimates the percentage to be 2.5%. What is the adjusting entry to record bad debt on 12/31/10?

Reference no: EM13150122

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