Find what is the total amount of bad debt expense

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Reference no: EM132585002

Hopper Inc. follows the balance sheet approach in preparing its allowance for doubtful accounts (AFDA). The opening AFDA balance as at January 1, 20X3, was a credit of $8,700. During the 20X3 fiscal year, a total of $7,860 was written off as uncollectable for the year and a total of $650 in previously written-off accounts was recovered.

Hopper has the following accounts receivable balances as at December 31, 20X3, including a breakdown of the percentage estimated by management to be uncollectable:

Days outstanding         Balance            % estimated to be uncollectable

0-30 days                 $480,520                   0.5%

31-60 days               187,600                    1.8%

61-90 days               77,250                     2.5%

Greater than 90 days  38,760                     4.5%

Question 1: What is the total amount of bad debt expense that Hopper needs to record for the December 31, 20X3, fiscal year? Round to the nearest dollar.

a) $ 7,965

b) $ 8,615

c) $ 9,455

d) $10,945

Reference no: EM132585002

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