Question

Allowance for Doubtful Accounts has a credit balance of $2,100 at the end of the year (before adjustment), and an analysis of customers' accounts indicates uncollectible receivables of $19,700. Which of the following entries records the proper adjustment for bad debt expense?

Answer 1

Answer:

Debit Bad Debt Expense, $17,600

Credit Allowance for Doubtful Accounts, $17,600

Explanation:

Uncollectible receivables of $19,700.

Less Allowance for Doubtful Accounts has a credit balance at the end of the year (before adjustment) at $2,100

Balance $17,600

Therefore the following entries records the proper adjustment for bad debt expense

Debit Bad Debt Expense $17,600

Credit Allowance for Doubtful Accounts, $17,600