Question

Allowance for Doubtful Accounts has a debit balance of $1,969 at the end of the year before adjustment), and an analysis of customers' accounts indicates uncollectible receivables of $13.419 Which of the following entries records the proper adjustment for Bad Debt Expense? Select the correct answer debit Allowance for Doubtful Accounts, $15,388 credit Bad Debt Expense, $15,388 debit Allowance for Doubtful Accounts, $11.450 credit Bad Debt Expense, $11.450 debit Bad Debt Expense, $11.450 credit Allowance for Doubtful Accounts, $11.450 debit Bad Debt Expense, $15,388 credit Allowance for Doubtful Accounts, $15,388 hp bresc delete backspac

Answer 1

• debit Bad debts Expenses, $15,388 credit allowance for doubtful accounts, $15,388.

Computation:-

Bad debts debit balance = $1,969

Add: Uncollectible receivable = $13,419

Total Bad debts Expenses for the year = $15,388

Explanation:-

• Bad debt expenses is also known as uncollectible receivables.
• This is the allowance method of accounting where we debit the Bad Debt expense for the amount of the estimated write-off, and credit the Allowance for Doubtful Accounts contra account for the same amount.