Your supervisor has asked you to do some work for

Your supervisor has asked you to do some work for her on Megan Company’s accounts
receivables.Selected information from Megan Company follows.For each situation, your
supervisor suggests that you do the following: 1. Write the correct entry for Megan Company to
record estimated Bad Debts Expense or actual Bad Debts Expense depending on the method
used to value Accounts Receivable. 2. Determine the balance of Allowance for Doubtful
Accounts at the end of December 2012. Situation A— Megan Company ages Accounts
Receivable to determine the amount of the adjustment for estimated Bad Debts Expense. The
following facts are available:Situation B— Megan Company uses a percentage of Accounts
Receivable to determine the amount of the adjustment for estimated Bad Debts Expense. The
firm’s average actual bad debts expense over the prior three consecutive years was 3 percent.
The firm believes that this is a reasonable estimate of Bad DebtsExpense. View Solution: Your
supervisor has asked you to do some work for
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