The account allowance for uncollectible accounts is classified as a(n contra account to uncollectible accounts expense. expense.
2 answers:
<u>Answer:</u>
The account allowance for uncollectible accounts is classified as a contra account to accounts receivable.
<u>Explanation:</u>
- It is a contra asset account. It is the allowance for bad debt reserve or doubtful actions.
- Contra accounts are reported on the financial statement same as that of the associated account, appearing directly below the associated account with a
line for the net amount.
- They are useful in preserving the historical value in main account while denoting a decrease in a separate contra account that sums to the current book value.
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Answer:
Option (C) is correct.
Explanation:
Total expenses:
= mortgage interest + property tax + utilities and maintenance + Depreciation expense
= $5,000 + $600 + $900 + $3,500
= $10,000
Proportionate rental expenses = Total expenses ×
Proportionate rental expenses = 10,000 ×
= $7,200
Rental Loss = Rental Income - Proportionate rental expenses
= $4,000 - $7,200
= -($3,200)