EX 9-15 Effect of doubtful accounts on net income
During its first year of operations, Filippi’s Plumbing Supply Co. had net sales of $4,800,000, wrote off $65,000 of accounts as uncollectible using the direct write-off method, and reported net income of $375,000. Determine what the net income would have been if the allowance method had been used, and the company estimated that 1½% of net sales would be uncollectible.
Click here for the solution: During its first year of operations, Filippi’s Plumbing Supply Co. had net sales of $4,800,000
