Question

which of the following is not true about the allowance for doubtful accounts? It is used instead of reducing accounts receivable directly, it is a liability account, it is a contra asset account, it is credited when bad debts expense is estimated and recorded, or it is debited when uncollectible accounts are written off

Answer 1

Answer: what is not true about Allowance for doubtful accounts is that ----It is a liability account

Explanation:

Allowance for doubtful accounts is a contra-asset account that shows only amounts expected to be paid by negating the total receivables recorded on the balance sheet.

The allowance for doubtful accounts is credited when bad debts expenses are recorded and debited when uncollectible accounts are written off.

In summary, Allowance for doubtful accounts estimates the amount of accounts receivable expected but will not be paid by customers.