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As of December 31, Frappe Company has a balance of $5,000 in accounts receivable. Of...

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Accounting

As of December 31, Frappe Company has a balance of $5,000 in accounts receivable. Of this amount, $500 is past due and the remainder is not yet due. Frappe has a debit balance of $15 in the Allowance for Doubtful Accounts. Frappe Company estimates its bad debt losses using the aging of receivables method, with estimated bad debt loss rates equal to 1% of accounts not yet due and 10% of past due accounts. How will the Bad Debt Expense account be included in the required adjusting journal entry at year-end?
Multiple Choice
Debit Bad Debt Expense $95
Credit Bad Debt Expense $80
Debit Bad Debt Expense $110
Credit Bad Debt Expense $80

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